CSW Industrials (NASDAQ: CSWI) and Westlake Chemical Corporation (NYSE:WLK) are both basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, dividends, institutional ownership, earnings, valuation and profitability.

Risk and Volatility

CSW Industrials has a beta of 1.36, indicating that its stock price is 36% more volatile than the S&P 500. Comparatively, Westlake Chemical Corporation has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500.

Dividends

Westlake Chemical Corporation pays an annual dividend of $0.84 per share and has a dividend yield of 1.0%. CSW Industrials does not pay a dividend. Westlake Chemical Corporation pays out 24.0% of its earnings in the form of a dividend. Westlake Chemical Corporation has increased its dividend for 13 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings for CSW Industrials and Westlake Chemical Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CSW Industrials 0 0 1 0 3.00
Westlake Chemical Corporation 0 2 10 0 2.83

Westlake Chemical Corporation has a consensus target price of $77.22, suggesting a potential downside of 9.12%. Given Westlake Chemical Corporation’s higher possible upside, analysts plainly believe Westlake Chemical Corporation is more favorable than CSW Industrials.

Valuation & Earnings

This table compares CSW Industrials and Westlake Chemical Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
CSW Industrials $341.00 million 2.13 $58.23 million $0.98 46.73
Westlake Chemical Corporation $6.94 billion 1.58 $1.33 billion $3.50 24.28

Westlake Chemical Corporation has higher revenue and earnings than CSW Industrials. Westlake Chemical Corporation is trading at a lower price-to-earnings ratio than CSW Industrials, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares CSW Industrials and Westlake Chemical Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CSW Industrials 4.54% 10.53% 7.39%
Westlake Chemical Corporation 6.57% 13.68% 5.03%

Institutional and Insider Ownership

69.4% of CSW Industrials shares are owned by institutional investors. Comparatively, 32.0% of Westlake Chemical Corporation shares are owned by institutional investors. 2.1% of CSW Industrials shares are owned by insiders. Comparatively, 72.5% of Westlake Chemical Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Westlake Chemical Corporation beats CSW Industrials on 11 of the 17 factors compared between the two stocks.

CSW Industrials Company Profile

CSW Industrials, Inc. (CSWI) is a diversified industrial growth company. The Company operates through three segments: Industrial Products; Coatings, Sealants & Adhesives, and Specialty Chemicals. The Industrial Products segment consists of specialty mechanical products; fire and smoke protection products; architecturally specified building products, and storage, filtration and application equipment. The Coatings, Sealants & Adhesives segment comprises coatings and penetrants, pipe thread sealants, firestopping sealants, and caulks and adhesives/solvent cements. The Specialty Chemicals segment manufactures and supplies specialized consumables that impart or enhance properties, such as lubricity, anti-seize qualities, friction and heat control. Markets that it serves include HVAC, industrial, rail, plumbing, architecturally specified building products, energy, mining and other general industrial markets.

Westlake Chemical Corporation Company Profile

Westlake Chemical Corporation is a global manufacturer and marketer of basic chemicals, vinyls, polymers and building products. The Company’s products include a range of chemicals, which are fundamental to various consumer and industrial markets, including flexible and rigid packaging, automotive products, coatings, water treatment, refrigerants, residential and commercial construction, as well as other durable and non-durable goods. Its segments include Olefins and Vinyls. It manufactures ethylene (through Westlake Chemical OpCo LP (OpCo)), polyethylene, styrene and associated co-products at its manufacturing facility in Lake Charles and polyethylene at its Longview facility. The Company’s products in its Vinyls segment include polyvinyl chloride (PVC), vinyl chloride monomer (VCM), ethylene dichloride (EDC), chlor-alkali (chlorine and caustic soda) and chlorinated derivative products and, through OpCo, ethylene. It also manufactures and sells building products fabricated from PVC.

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