Andrew Kenner's Recent Buy: Acquires $93K In Westlake Chemical Stock

A significant insider buy by Andrew Kenner, SVP at Westlake Chemical WLKP, was executed on March 25, and reported in the recent SEC filing.

What Happened: In a significant move reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday, Kenner purchased 4,230 shares of Westlake Chemical, demonstrating confidence in the company's growth potential. The total value of the transaction stands at $93,736.

Monitoring the market, Westlake Chemical's shares down by 2.42% at $21.75 during Monday's morning.

Delving into Westlake Chemical's Background

Westlake Chemical Partners LP is a part of the chemical industry in the United States. Its operations are conducted through OpCo, it acquires and develop ethyelene production facilities, which convert ethane into ethylene. OpCo sells ethylene and its co-products such as propylene, crude butadiene, pyrolysis gasoline, and hydrogen to Westlake and other customers located in the United States. Its assets include three ethylene production facilities in Calvert City, Kentucky, and Lake Charles, Louisiana.

Understanding the Numbers: Westlake Chemical's Finances

Revenue Challenges: Westlake Chemical's revenue growth over 3 months faced difficulties. As of 31 December, 2023, the company experienced a decline of approximately -18.96%. This indicates a decrease in top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Materials sector.

Analyzing Profitability Metrics:

• Gross Margin: The company maintains a high gross margin of 33.87%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): Westlake Chemical's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 0.41.

Debt Management: Westlake Chemical's debt-to-equity ratio surpasses industry norms, standing at 1.43. This suggests the company carries a substantial amount of debt, posing potential financial challenges.

Valuation Analysis:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 14.47 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 0.66, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Westlake Chemical's EV/EBITDA ratio at 2.39 suggests potential undervaluation, falling below industry averages.

Market Capitalization Perspectives: The company's market capitalization falls below industry averages, signaling a relatively smaller size compared to peers. This positioning may be influenced by factors such as perceived growth potential or operational scale.

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Understanding the Significance of Insider Transactions

Investors should view insider transactions as part of a multifaceted analysis and not rely solely on them for decision-making.

From a legal standpoint, the term "insider" pertains to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider's new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Important Transaction Codes

Digging into the details of stock transactions, investors frequently turn their attention to those taking place in the open market, as outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Westlake Chemical's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.