Westlake (NYSE:WLK) Posts Earnings Results, Misses Expectations By $0.15 EPS

Key Points

• Westlake reported a quarterly EPS of ($0.09), falling short of expectations by $0.15, with revenue also down significantly at $2.95 billion compared to anticipated $3 billion.
• The company announced a quarterly dividend of $0.4714 per share, with a resulting annualized yield of 2.2%, despite a dividend payout ratio of 70.47%.
• Westlake's stock has seen significant analyst rating adjustments, with price targets reduced by various firms, leading to an average price target of $93.77 and an overall rating of "Hold."

Westlake (NYSE:WLK - Get Free Report) issued its quarterly earnings results on Tuesday. The specialty chemicals company reported ($0.09) earnings per share for the quarter, missing analysts' consensus estimates of $0.06 by ($0.15), Zacks reports. The firm had revenue of $2.95 billion for the quarter, compared to the consensus estimate of $3 billion. Westlake had a return on equity of 4.19% and a net margin of 3.23%. The business's revenue was down 7.9% on a year-over-year basis. During the same period last year, the company posted $2.40 EPS.

Westlake Trading Up 10.6%

Shares of NYSE WLK traded up $8.12 during mid-day trading on Tuesday, reaching $84.37. The company had a trading volume of 1,339,273 shares, compared to its average volume of 1,009,286. The business's 50-day moving average is $78.28 and its 200-day moving average is $92.13. The company has a current ratio of 2.63, a quick ratio of 1.86 and a debt-to-equity ratio of 0.42. The stock has a market cap of $10.82 billion, a price-to-earnings ratio of 28.31, a price-to-earnings-growth ratio of 18.62 and a beta of 0.92. Westlake has a 52 week low of $68.55 and a 52 week high of $153.34.

Westlake Cuts Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, August 27th. Shareholders of record on Tuesday, August 12th will be given a dividend of $0.4714 per share. This represents a $1.89 dividend on an annualized basis and a yield of 2.2%. Westlake's dividend payout ratio (DPR) is 70.47%.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of the company. Royal Bank of Canada raised its position in shares of Westlake by 90.0% in the 1st quarter. Royal Bank of Canada now owns 38,687 shares of the specialty chemicals company's stock valued at $3,869,000 after purchasing an additional 18,321 shares during the last quarter. AQR Capital Management LLC increased its holdings in shares of Westlake by 9.6% during the 1st quarter. AQR Capital Management LLC now owns 19,094 shares of the specialty chemicals company's stock valued at $1,881,000 after purchasing an additional 1,668 shares in the last quarter. Finally, United Services Automobile Association purchased a new position in shares of Westlake during the 1st quarter valued at approximately $211,000. Institutional investors own 28.40% of the company's stock.

Analyst Upgrades and Downgrades

WLK has been the subject of several analyst reports. The Goldman Sachs Group dropped their price target on shares of Westlake from $130.00 to $95.00 and set a "neutral" rating for the company in a research note on Tuesday, May 6th. BMO Capital Markets set a $94.00 price target on shares of Westlake and gave the stock a "market perform" rating in a report on Tuesday, May 20th. Bank of America reduced their price objective on shares of Westlake from $90.00 to $84.00 and set a "buy" rating for the company in a report on Wednesday, June 18th. Barclays cut their price target on shares of Westlake from $135.00 to $100.00 and set an "overweight" rating on the stock in a report on Monday, May 5th. Finally, UBS Group lowered their price objective on shares of Westlake from $101.00 to $99.00 and set a "buy" rating on the stock in a research report on Wednesday, July 9th. One investment analyst has rated the stock with a sell rating, six have assigned a hold rating and seven have assigned a buy rating to the stock. According to MarketBeat.com, the stock has an average rating of "Hold" and an average price target of $93.77.

About Westlake

Westlake Corporation engages in the manufacture and marketing of performance and essential materials, and housing and infrastructure products in the United States, Canada, Germany, China, Mexico, Brazil, France, Italy, Taiwan, and internationally. The company operates through two segments: Performance and Essential Materials and Housing and Infrastructure Products.

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