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Westlake Chemical (WLK) Tops Earnings, Sales Estimates in Q1
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Westlake Chemical Corporation (WLK - Free Report) recorded a profit of $287 million or $2.20 per share for first-quarter 2018, marking a roughly two-fold rise from $138 million or $1.06 per share earned a year ago.
The bottom line in the reported quarter was boosted by higher selling prices for key products, increased sales volumes for caustic soda and PVC (polyvinyl chloride) resin, benefits of lower U.S. corporate tax rate and a gain from redemption of debt.
Barring one-time items, earnings for the reported quarter were $2.24 per share, which beat the Zacks Consensus Estimate of $2.09.
Westlake Chemical posted first-quarter revenues of $2,150 million, up roughly 10.7% year over year. It beat the Zacks Consensus Estimate of $2,101 million.
Sales in the quarter benefited from higher prices for major products and increased sales volumes for caustic soda and PVC resin that more than offset reduced polyethylene sales volume.
Westlake Chemical Corporation Price, Consensus and EPS Surprise
Sales from the Olefins segment fell roughly 7.4% year over year to $503 million in the quarter. Operating income of the segment decreased 9.4% year over year to $163 million, hurt by reduced polyethylene sales volumes and increased feedstock costs.
The Vinyls segment logged sales of $1,647 million, up roughly 17.6% year over year. Operating income of the segment was $266 million, a nearly four-fold year-over-year increase, driven by higher prices for major products and increased sales volumes for caustic soda and PVC resin.
Financial Position
Westlake Chemical ended the quarter with cash and cash equivalents of roughly $851 million, a more than two-fold rise year over year. Total debt was $3,127 million at the end of the quarter, down 13% year over year.
Cash flow from operations was around $225 million for the quarter, up around 43% year over year.
Outlook
The company noted that demand for products across its segments remains strong due to continued growth in the Americas, Europe and Asia. Moreover, it is benefiting from the investments made last year to improve its operations and reliability.
Westlake Chemical is working diligently on the recently announced expansions in its Vinyls segment. It also remains committed to capture the targeted synergies and cost reductions along with other opportunities that will improve its operations.
Price Performance
Shares of Westlake Chemical have rallied 73.6% over a year, outperforming the 44.5% gain recorded by its industry.
Zacks Rank & Other Stocks to Consider
Westlake Chemical carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the basic materials space include Kronos Worldwide Inc. (KRO - Free Report) , Celanese Corporation (CE - Free Report) and Methanex Corporation (MEOH - Free Report) .
Celanese has an expected long-term earnings growth rate of 8.9% and flaunts a Zacks Rank #1. Its shares have gained roughly 25% over a year.
Methanex has an expected long-term earnings growth rate of 15% and carries a Zacks Rank #2 (Buy). Its shares have roughly 43% over a year.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Westlake Chemical (WLK) Tops Earnings, Sales Estimates in Q1
Westlake Chemical Corporation (WLK - Free Report) recorded a profit of $287 million or $2.20 per share for first-quarter 2018, marking a roughly two-fold rise from $138 million or $1.06 per share earned a year ago.
The bottom line in the reported quarter was boosted by higher selling prices for key products, increased sales volumes for caustic soda and PVC (polyvinyl chloride) resin, benefits of lower U.S. corporate tax rate and a gain from redemption of debt.
Barring one-time items, earnings for the reported quarter were $2.24 per share, which beat the Zacks Consensus Estimate of $2.09.
Westlake Chemical posted first-quarter revenues of $2,150 million, up roughly 10.7% year over year. It beat the Zacks Consensus Estimate of $2,101 million.
Sales in the quarter benefited from higher prices for major products and increased sales volumes for caustic soda and PVC resin that more than offset reduced polyethylene sales volume.
Westlake Chemical Corporation Price, Consensus and EPS Surprise
Westlake Chemical Corporation price-consensus-eps-surprise-chart | Westlake Chemical Corporation Quote
Segment Highlights
Sales from the Olefins segment fell roughly 7.4% year over year to $503 million in the quarter. Operating income of the segment decreased 9.4% year over year to $163 million, hurt by reduced polyethylene sales volumes and increased feedstock costs.
The Vinyls segment logged sales of $1,647 million, up roughly 17.6% year over year. Operating income of the segment was $266 million, a nearly four-fold year-over-year increase, driven by higher prices for major products and increased sales volumes for caustic soda and PVC resin.
Financial Position
Westlake Chemical ended the quarter with cash and cash equivalents of roughly $851 million, a more than two-fold rise year over year. Total debt was $3,127 million at the end of the quarter, down 13% year over year.
Cash flow from operations was around $225 million for the quarter, up around 43% year over year.
Outlook
The company noted that demand for products across its segments remains strong due to continued growth in the Americas, Europe and Asia. Moreover, it is benefiting from the investments made last year to improve its operations and reliability.
Westlake Chemical is working diligently on the recently announced expansions in its Vinyls segment. It also remains committed to capture the targeted synergies and cost reductions along with other opportunities that will improve its operations.
Price Performance
Shares of Westlake Chemical have rallied 73.6% over a year, outperforming the 44.5% gain recorded by its industry.
Zacks Rank & Other Stocks to Consider
Westlake Chemical carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the basic materials space include Kronos Worldwide Inc. (KRO - Free Report) , Celanese Corporation (CE - Free Report) and Methanex Corporation (MEOH - Free Report) .
Kronos has an expected long-term earnings growth rate of 5% and flaunts a Zacks Rank #1. The company’s shares have moved up around 39% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Celanese has an expected long-term earnings growth rate of 8.9% and flaunts a Zacks Rank #1. Its shares have gained roughly 25% over a year.
Methanex has an expected long-term earnings growth rate of 15% and carries a Zacks Rank #2 (Buy). Its shares have roughly 43% over a year.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>