Westlake Chemical Corporation (WLK)
Return on equity (ROE)
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 479,000 | 2,247,000 | 2,015,000 | 330,000 | 421,000 |
| Total stockholders’ equity | US$ in thousands | 10,241,000 | 9,931,000 | 7,955,000 | 6,043,000 | 5,860,000 |
| ROE | 4.68% | 22.63% | 25.33% | 5.46% | 7.18% |
December 31, 2023 calculation
ROE = Net income ÷ Total stockholders’ equity
= $479,000K ÷ $10,241,000K
= 4.68%
Westlake Corporation's return on equity (ROE) has fluctuated over the past five years, ranging from a low of 4.65% in 2023 to a high of 25.20% in 2021. The significant decrease in ROE from 2021 to 2023 suggests a decrease in profitability or efficiency in generating returns for shareholders.
The ROE of 4.65% in 2023 indicates that the company generated $0.0465 in net income for every $1 of shareholders' equity, reflecting a decline in profitability compared to the previous years.
It is essential for Westlake Corporation to investigate the factors contributing to the decrease in ROE in 2023 compared to the higher ROE levels seen in 2021 and 2022. This analysis could unveil weaknesses in the company's operations or strategy that need to be addressed to improve financial performance and enhance shareholder value in the future.
Peer comparison
Dec 31, 2023