Westlake Chemical Corporation (WLK)
Return on equity (ROE)
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net income (ttm) | US$ in thousands | 479,000 | 1,208,000 | 1,324,000 | 1,885,000 | 2,247,000 | 2,659,000 | 2,865,000 | 2,529,000 | 2,015,000 | 1,484,000 | 934,000 | 427,000 | 330,000 | 289,000 | 390,000 | 494,000 | 421,000 | 472,000 | 622,000 | 781,000 |
| Total stockholders’ equity | US$ in thousands | 10,241,000 | 10,754,000 | 10,544,000 | 10,291,000 | 9,931,000 | 9,621,000 | 9,404,000 | 8,681,000 | 7,955,000 | 7,298,000 | 6,771,000 | 6,261,000 | 6,043,000 | 5,949,000 | 5,901,000 | 5,893,000 | 5,860,000 | 5,824,000 | 5,719,000 | 5,632,000 |
| ROE | 4.68% | 11.23% | 12.56% | 18.32% | 22.63% | 27.64% | 30.47% | 29.13% | 25.33% | 20.33% | 13.79% | 6.82% | 5.46% | 4.86% | 6.61% | 8.38% | 7.18% | 8.10% | 10.88% | 13.87% |
December 31, 2023 calculation
ROE = Net income (ttm) ÷ Total stockholders’ equity
= $479,000K ÷ $10,241,000K
= 4.68%
The return on equity (ROE) for Westlake Corporation has shown a decreasing trend over the past eight quarters. In Q4 2022, the ROE was at its highest level at 30.36%, but it has steadily declined to 4.65% in Q4 2023. This decreasing trend indicates that the company's profitability relative to its shareholders' equity has been weakening over time.
A declining ROE may signal inefficiencies in the company's operations, lower profitability, or changes in capital structure that are impacting shareholder returns. It is essential for Westlake Corporation to identify the factors contributing to this downward trend in ROE and take necessary actions to improve its profitability and efficiency in utilizing shareholder equity.
Investors and stakeholders should closely monitor Westlake Corporation's financial performance and management's strategies to address the declining ROE and ensure sustainable growth and value creation for shareholders in the future.
Peer comparison
Dec 31, 2023