Is Westlake Chemical (WLK) Poised To Beat On Q1 Earnings?
Zacks Investment Research | Apr 28, 2017 06:02AM ET
Westlake Chemical (NYSE:WLK) is set to release its first-quarter 2017 results before the market opens on May 2.
Westlake Chemical’s adjusted earnings came in at 87 cents per share in the fourth quarter of 2016, beating the Zacks Consensus Estimate of 75 cents.
Westlake Chemical reported revenues of $1,735.2 million for the quarter, up around 76% year over year. Sales in the quarter benefited from the contribution of Axiall acquisition. However, revenues missed the Zacks Consensus Estimate of $1,776 million.
The company beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in the other one, delivering an average positive surprise of 11.14%. Let’s take a look at how things are shaping up for the forthcoming announcement.
Earnings Whispers
Our proven model shows that Westlake Chemical is likely to beat the Zacks Consensus Estimate this quarter, because a stock needs to have both a positive Earnings ESP Filter .
Zacks Rank: Westlake Chemical currently carries a Zacks Rank #3, which when combined with a positive ESP, make us reasonably confident of an earnings beat.
Note that we caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Westlake Chemical Corporation Price and EPS Surprise
Chemicals-Plastics industry’s gain of 5.9%.
The Olefins segment registered income of $149.5 million in the last quarter, an increase of 7.8% year over year. The segment benefitted from record production of ethylene which partly offset the impact of low margins of integrated olefin products.
However, the Vinyls segment reported income of $37.6 million in fourth-quarter 2016, a decrease of 27.1% year over year. The sales of this segment decreased due to lower production and sales volume, higher cost of selling Axiall inventory at fair value, unabsorbed fixed cost associated with manufacturing and planned turnaround at Lake Charles vinyls operations.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
The CF Industries Holdings, Inc. (NYSE:CF) has an Earnings ESP of +55.56% and sports a Zacks Rank #3.
Get The News You Want
Franco-Nevada Corp. (TO:FNV) has an Earnings ESP of +10.00% and carries a Zacks Rank #3.
Ryerson Holding Corp. (NYSE:RYI) has an Earnings ESP of +2.86% and carries a Zacks Rank #3.
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