Exploring the Sustainability and Growth of Westlake Corp's Dividends
Westlake Corp (WLK, Financial) recently announced a dividend of $0.50 per share, payable on June 6, 2024, with the ex-dividend date set for May 20, 2024. As investors anticipate this upcoming payment, it is crucial to delve into the company's dividend history, yield, and growth rates. Using data from GuruFocus, this analysis will explore Westlake Corp's dividend performance and assess its sustainability.
What Does Westlake Corp Do?
Westlake Corp is a prominent manufacturer and supplier of chemicals, polymers, and building products. The company's Performance and Essential Materials segment provides vital building blocks like olefins, vinyl chemicals, polyethylene, and epoxies. These materials are essential for products used in everyday life. Additionally, its Housing and Infrastructure Products segment produces significant finished goods for building products, pipe and fittings, and global compounds businesses.
A Glimpse at Westlake Corp's Dividend History
Since 2004, Westlake Corp has consistently paid dividends, currently on a quarterly basis. Remarkably, the company has increased its dividend annually since 2004, earning it the status of a dividend achiever. This title is reserved for companies that have consistently raised their dividends for at least 20 consecutive years.
Below is a chart showing the annual Dividends Per Share to track historical trends.
Breaking Down Westlake Corp's Dividend Yield and Growth
Currently, Westlake Corp has a 12-month trailing dividend yield of 1.18% and a forward dividend yield of 1.27%. This indicates an expected increase in dividend payments over the next 12 months. Over the past three years, the annual dividend growth rate was 17.20%, decreasing to 11.80% over five years, yet maintaining a robust 12.30% over the past decade. Today, the 5-year yield on cost for Westlake Corp stock is approximately 2.06%.
The Sustainability Question: Payout Ratio and Profitability
Assessing the sustainability of dividends involves examining the dividend payout ratio, which reveals the portion of earnings distributed as dividends. Westlake Corp's ratio stands at 0.29 as of March 31, 2024, indicating a healthy balance between dividend payments and retained earnings for growth. The company's profitability rank is 9 out of 10, reflecting strong earnings relative to peers, with consistent positive net income over the past decade.
Growth Metrics: The Future Outlook
Westlake Corp's growth rank of 9 out of 10 underscores a promising growth trajectory. The company's revenue per share and 3-year revenue growth rate of 18.50% annually outperform approximately 79.05% of global competitors. Additionally, the 3-year EPS growth rate of 33.90% and 5-year EBITDA growth rate of 17.90% further highlight its capacity to sustain dividends.
Conclusion
Considering Westlake Corp's consistent dividend growth, prudent payout ratio, robust profitability, and solid growth metrics, the company appears well-positioned to maintain its dividend payments. These factors make Westlake Corp a compelling candidate for investors seeking stable dividend income. For those interested in exploring further, GuruFocus Premium users can utilize the High Dividend Yield Screener to discover more high-yield investment opportunities.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
