Yahoo Finance Why I Like Westlake Chemical Partners LP (NYSE:WLKP)
Westlake Chemical Partners LP (NYSE:WLKP) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of WLKP, it is a financially-robust company with a a excellent future outlook, not yet reflected in the share price. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the full report on Westlake Chemical Partners here.
Very undervalued with reasonable growth potential and pays a dividend
WLKP is currently trading below its true value, which means the market is undervaluing the company’s expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if WLKP’s projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, WLKP’s share price is trading below the group’s average. This supports the theory that WLKP is potentially underpriced.
WLKP’s ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This indicates that WLKP has sufficient cash flows and proper cash management in place, which is an important determinant of the company’s health. WLKP’s has produced operating cash levels of 1.04x total debt over the past year, which implies that WLKP’s management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
Next Steps:
For Westlake Chemical Partners, I’ve compiled three fundamental factors you should look at:
Historical Performance: What has WLKP’s returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Dividend Income vs Capital Gains: Does WLKP return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from WLKP as an investment.
Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of WLKP? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
