Reviewing Chemours Company (The) (CC) and Westlake Chemical Partners (WLKP)
Chemours Company (The) (NYSE: CC) and Westlake Chemical Partners (NYSE:WLKP) are both basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.
Insider & Institutional Ownership
72.9% of Chemours Company (The) shares are held by institutional investors. Comparatively, 73.3% of Westlake Chemical Partners shares are held by institutional investors. 1.1% of Chemours Company (The) shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Chemours Company (The) pays an annual dividend of $0.12 per share and has a dividend yield of 0.2%. Westlake Chemical Partners pays an annual dividend of $1.46 per share and has a dividend yield of 6.5%. Chemours Company (The) pays out 8.1% of its earnings in the form of a dividend. Westlake Chemical Partners pays out 102.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Westlake Chemical Partners has raised its dividend for 2 consecutive years. Westlake Chemical Partners is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk and Volatility
Chemours Company (The) has a beta of 3.59, indicating that its share price is 259% more volatile than the S&P 500. Comparatively, Westlake Chemical Partners has a beta of 1.21, indicating that its share price is 21% more volatile than the S&P 500.
This table compares Chemours Company (The) and Westlake Chemical Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Chemours Company (The)||4.96%||122.97%||6.77%|
|Westlake Chemical Partners||3.60%||4.34%||2.54%|
This is a summary of recent ratings for Chemours Company (The) and Westlake Chemical Partners, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Chemours Company (The)||0||0||6||0||3.00|
|Westlake Chemical Partners||0||0||2||0||3.00|
Chemours Company (The) currently has a consensus target price of $51.83, indicating a potential downside of 4.77%. Westlake Chemical Partners has a consensus target price of $26.50, indicating a potential upside of 18.04%. Given Westlake Chemical Partners’ higher probable upside, analysts plainly believe Westlake Chemical Partners is more favorable than Chemours Company (The).
Earnings & Valuation
This table compares Chemours Company (The) and Westlake Chemical Partners’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Chemours Company (The)||$5.74 billion||1.75||$1.07 billion||$1.48||36.78|
|Westlake Chemical Partners||$1.09 billion||0.56||$456.12 million||$1.42||15.81|
Chemours Company (The) has higher revenue and earnings than Westlake Chemical Partners. Westlake Chemical Partners is trading at a lower price-to-earnings ratio than Chemours Company (The), indicating that it is currently the more affordable of the two stocks.
Chemours Company (The) beats Westlake Chemical Partners on 12 of the 16 factors compared between the two stocks.
About Chemours Company (The)
The Chemours Company is a provider of performance chemicals. The Company operates through three segments: Titanium Technologies, Fluoroproducts and Chemical Solutions. The Titanium Technologies segment is a producer of titanium dioxide (TiO2). The Fluoroproducts segment is a provider of fluoroproducts, including refrigerants and industrial fluoropolymer resins. The Chemical Solutions segment is a North American provider of industrial chemicals used in gold production, oil and gas, water treatment and other industries. It delivers customized solutions with a range of industrial and specialty chemical products for markets, including plastics and coatings, refrigeration and air conditioning, industrial, mining and oil refining. Its products include titanium dioxide, refrigerants, industrial fluoropolymer resins and a portfolio of mining and industrial chemicals, including sodium cyanide. As of December 31, 2016, the Company operates 26 production facilities located in 10 countries.
About Westlake Chemical Partners
Westlake Chemical Partners LP is a limited partnership formed by Westlake Chemical Corporation (Westlake). The Company operates, acquires and develops ethylene production facilities and other assets. Its business and operations are conducted through Westlake Chemical OpCo LP (OpCo). OpCo sells ethylene to Westlake and others, as well as sells co-products of ethylene production, including propylene, crude butadiene, pyrolysis gasoline and hydrogen. As of December 31, 2016, OpCo’s assets included three ethylene production facilities, which primarily convert ethane into ethylene, and a 200-mile ethylene pipeline. As of December 31, 2016, OpCo owned two ethylene production facilities at Westlake’s Lake Charles, Louisiana site (Petro 1 and Petro 2, collectively Lake Charles Olefins), and one ethylene production facility at Westlake’s Calvert City, Kentucky site (Calvert City Olefins), with an annual capacity of approximately 630 million pounds.
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