Green Plains Partners (GPP) versus Westlake Chemical (WLK) Critical Comparison

Green Plains Partners (NASDAQ: GPP) and Westlake Chemical (NYSE:WLK) are both transportation companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, profitability, institutional ownership, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Green Plains Partners and Westlake Chemical’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Green Plains Partners 54.20% -89.44% 61.48%
Westlake Chemical 17.61% 17.77% 7.67%

Dividends

Green Plains Partners pays an annual dividend of $1.90 per share and has a dividend yield of 10.8%. Westlake Chemical pays an annual dividend of $0.84 per share and has a dividend yield of 0.7%. Green Plains Partners pays out 105.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Westlake Chemical pays out 15.4% of its earnings in the form of a dividend. Westlake Chemical has increased its dividend for 14 consecutive years.

Institutional and Insider Ownership

19.1% of Green Plains Partners shares are owned by institutional investors. Comparatively, 30.1% of Westlake Chemical shares are owned by institutional investors. 72.0% of Westlake Chemical shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings for Green Plains Partners and Westlake Chemical, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Green Plains Partners 1 1 3 0 2.40
Westlake Chemical 2 6 9 0 2.41

Green Plains Partners currently has a consensus target price of $19.40, indicating a potential upside of 10.23%. Westlake Chemical has a consensus target price of $116.60, indicating a potential downside of 3.97%. Given Green Plains Partners’ higher probable upside, analysts plainly believe Green Plains Partners is more favorable than Westlake Chemical.

Valuation & Earnings

This table compares Green Plains Partners and Westlake Chemical’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Green Plains Partners $106.99 million 5.23 $58.86 million $1.81 9.72
Westlake Chemical $8.04 billion 1.96 $1.30 billion $5.47 22.20

Westlake Chemical has higher revenue and earnings than Green Plains Partners. Green Plains Partners is trading at a lower price-to-earnings ratio than Westlake Chemical, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Green Plains Partners has a beta of 0.68, suggesting that its stock price is 32% less volatile than the S&P 500. Comparatively, Westlake Chemical has a beta of 1.56, suggesting that its stock price is 56% more volatile than the S&P 500.

Summary

Westlake Chemical beats Green Plains Partners on 12 of the 17 factors compared between the two stocks.

Green Plains Partners Company Profile

Green Plains Partners LP provides fuel storage and transportation services. It acquires, owns, develops, and operates ethanol and fuel storage tanks, terminals, transportation assets, and other related assets and businesses. The company owns or leases 39 ethanol storage facilities and approximately 61 acres of land. Green Plains Holdings LLC serves as the general partner of the company. The company was founded in 2015 and is headquartered in Omaha, Nebraska. Green Plains Partners LP is a subsidiary of Green Plains Inc.

Westlake Chemical Company Profile

Westlake Chemical Corporation manufactures and markets basic chemicals, vinyls, polymers, and building products primarily in North America and Europe. It operates through two segments, Olefins and Vinyls. The Olefins segment offers polyethylene, styrene monomers, and various ethylene co-products, as well as sells propylene, crude butadiene, pyrolysis gasoline, and hydrogen products. The Vinyls segment provides specialty and commodity polyvinyl chloride (PVC), vinyl chloride monomers, ethylene dichloride, chlorine, caustic soda, chlorinated derivative, and ethylene products. This segment also manufactures and sells building products fabricated from PVC, including pipe, fittings, profiles, trims, moldings, fence and decking products, window and door components, and film and sheet products. Westlake Chemical Corporation offers its products to a range of customers, including chemical processors, plastics fabricators, small construction contractors, municipalities, and supply warehouses in various consumer and industrial markets, such as flexible and rigid packaging, automotive products, coatings, water treatment, refrigerants, residential and commercial construction, as well as other durable and non-durable goods. The company was founded in 1985 and is headquartered in Houston, Texas. Westlake Chemical Corporation is a subsidiary of TTWF LP.

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