Contrasting Westlake (NYSE:WLK) and 5N Plus (OTCMKTS:FPLSF)

Westlake (NYSE:WLK) and 5N Plus (OTCMKTS:FPLSF) are both materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, valuation, analyst recommendations, profitability, earnings, dividends and institutional ownership.

Institutional and Insider Ownership

28.4% of Westlake shares are held by institutional investors. Comparatively, 0.1% of 5N Plus shares are held by institutional investors. 1.4% of Westlake shares are held by company insiders. Comparatively, 3.9% of 5N Plus shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings for Westlake and 5N Plus, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Westlake	1	10	4	0	2.20
5N Plus	0	1	2	1	3.00

Westlake currently has a consensus target price of $92.43, suggesting a potential upside of 36.75%. Given Westlake’s higher possible upside, equities research analysts clearly believe Westlake is more favorable than 5N Plus.

Valuation & Earnings

This table compares Westlake and 5N Plus”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Westlake	$11.17 billion	0.77	-$1.51 billion	($9.58)	-7.06
5N Plus	$391.06 million	4.82	$50.57 million	$0.70	29.94

5N Plus has lower revenue, but higher earnings than Westlake. Westlake is trading at a lower price-to-earnings ratio than 5N Plus, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Westlake and 5N Plus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Westlake	-10.94%	0.93%	0.44%
5N Plus	14.14%	26.36%	11.28%

Risk & Volatility

Westlake has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500. Comparatively, 5N Plus has a beta of 1.86, suggesting that its stock price is 86% more volatile than the S&P 500.

Summary

5N Plus beats Westlake on 11 of the 15 factors compared between the two stocks.

About Westlake

Westlake Corporation engages in the manufacture and marketing of performance and essential materials, and housing and infrastructure products in the United States, Canada, Germany, China, Mexico, Brazil, France, Italy, Taiwan, and internationally. The company operates through two segments: Performance and Essential Materials and Housing and Infrastructure Products. The Performance and Essential Materials segment offers ethylene, polyethylene, styrene, chlorinated derivative products, ethylene dichloride, vinyl chloride monomer, polyvinyl chloride (PVC), epoxy specialty resins, and base epoxy resins and intermediaries, as well as chlor-alkali, such as chlorine and caustic soda. The Housing and Infrastructure Products segment provides residential PVC sidings; PVC trim and mouldings; architectural stone veneers; windows; PVC decking; PVC films for various inflatables, wallcovering, and tape and roofing applications; polymer composite and cement roof tiles; PVC pipes and fittings for various water, sewer, electrical, and industrial applications; PVC compounds used in various housing, medical, and automobile products; and consumer and commercial products, such as landscape edging; industrial, home, and office matting; marine dock edging; and masonry joint controls. It offers its products to chemical processors, plastics fabricators, small construction contractors, municipalities, and supply warehouses for use in various consumer and industrial markets, including residential construction, flexible and rigid packaging, automotive products, healthcare products, water treatment, wind turbines, and coatings, as well as other durable and non-durable goods. The company was formerly known as Westlake Chemical Corporation and changed its name to Westlake Corporation in February 2022. Westlake Corporation was founded in 1986 and is headquartered in Houston, Texas. Westlake Corporation operates as a subsidiary of TTWF LP.

About 5N Plus

5N Plus Inc. produces and sells specialty metals and chemicals in North America, Europe, and Asia. It operates through two segments, Specialty Semiconductors and Performance Materials. The company offers semiconductor compounds, semiconductor wafers, metals, epitaxial semiconductor substrates, and solar cells. It also provides active pharmaceutical ingredients, animal feed additives, specialized chemicals, commercial grade metals, alloys, engineered powders, and recycling services. The company serves renewable energy, security, space, pharmaceutical, medical imaging, manufacturing, electronic, consumer, and industrial application markets. 5N Plus Inc. is headquartered in Montreal, Canada.