WLK
Westlake Corporation (WLK) Business Model Analysis (2026)
Overall Score
Revenue Quality
Revenue remains supported by a low price-to-sales multiple of 0.88x and a 1.24x EV/sales valuation.
Gross margin is thin at 4.7%, limiting the quality of top-line conversion.
Profitability
Margins remain negative, with EBIT margin at -11.2% and net margin at -10.9%.
Returns are still weak, with ROIC at -6.4% and ROE at -13.9%.
Cash Generation
Operating cash flow is positive, but free cash flow remains negative at -$495.6M TTM.
Free cash flow yield is negative at -5.7%, reflecting weak conversion after capital spending.
Balance Sheet
Liquidity remains solid with a current ratio of 2.45x and quick ratio of 1.70x.
Leverage is manageable with debt-to-equity at 0.66x, though net debt remains elevated relative to EBITDA.
Business Stability
Working capital remains positive at $3.37B, supporting near-term operating flexibility.
The cash conversion cycle is still long at 92.7 days, indicating moderate working-capital drag.
Sources
- Company filings (10-K, 10-Q, investor presentations)
- Financial and market data providers
- Public news and industry information
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