Westlake Chemical (WLK) Stock Forecast & Price Target

Westlake Corp has demonstrated a positive outlook due to a 0.7% year-over-year increase in US housing starts, which bodes well for demand across its Housing and Infrastructure Products segment. The company achieved solid margins of 23.7%, significantly surpassing earlier expectations, indicating robust financial performance that could sustain high-margin conditions in the future. Additionally, Westlake's substantial cash balance positions it favorably for strategic expansion or enhanced shareholder returns, reinforcing investor confidence in its long-term growth potential.

Westlake Corp has experienced a decline in US contract prices for polyvinyl chloride and polyethylene, with reported decreases of 3 cents per pound and a drop in industry operating rates, signaling weakening demand in its key segments. The housing market has also remained under pressure, with April housing starts down 2% year-over-year, particularly for single-family homes, which are down 12% year-over-year, contributing to negative sentiment regarding the Housing and Infrastructure Products segment. Additionally, earnings expectations have been downgraded, with projected EBITDA for 2025 and 2026 lowered significantly, reflecting ongoing challenges in both of Westlake's primary business segments.