Reviewing Orion (NYSE:OEC) and Westlake Chemical Partners (NYSE:WLKP)

Orion (NYSE:OEC) and Westlake Chemical Partners (NYSE:WLKP) are both small-cap basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, institutional ownership, dividends, analyst recommendations, risk and earnings.

Analyst Recommendations

This is a summary of current ratings and target prices for Orion and Westlake Chemical Partners, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Orion	3	2	0	0	1.40
Westlake Chemical Partners	0	2	0	0	2.00

Orion presently has a consensus target price of $7.33, suggesting a potential upside of 30.60%. Given Orion’s higher probable upside, equities research analysts clearly believe Orion is more favorable than Westlake Chemical Partners.

Earnings and Valuation

This table compares Orion and Westlake Chemical Partners”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Orion	$1.84 billion	0.17	$44.20 million	$0.27	20.80
Westlake Chemical Partners	$1.10 billion	0.64	$62.39 million	$1.49	13.37

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

Institutional and Insider Ownership

94.3% of Orion shares are owned by institutional investors. Comparatively, 78.3% of Westlake Chemical Partners shares are owned by institutional investors. 2.2% of Orion shares are owned by insiders. Comparatively, 1.1% of Westlake Chemical Partners shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk & Volatility

Orion has a beta of 1.02, suggesting that its stock price is 2% more volatile than the S&P 500. Comparatively, Westlake Chemical Partners has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.

Dividends

Orion pays an annual dividend of $0.08 per share and has a dividend yield of 1.4%. Westlake Chemical Partners pays an annual dividend of $1.88 per share and has a dividend yield of 9.4%. Orion pays out 29.6% of its earnings in the form of a dividend. Westlake Chemical Partners pays out 126.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Orion	0.82%	16.67%	4.00%
Westlake Chemical Partners	4.78%	6.38%	4.00%

Summary

Orion beats Westlake Chemical Partners on 8 of the 14 factors compared between the two stocks.

About Orion

Orion S.A., together with its subsidiaries, engages in the manufacture and sale of carbon black products. It operates in two segments, Specialty Carbon Black and Rubber Carbon Black. The company offers post-treated specialty carbon black grades for coatings and printing applications; high purity carbon black grades for the fiber industry; and conductive carbon black grades for batteries, polymers, and coatings. It also provides rubber carbon black products for applications in mechanical rubber goods, as well as in tires under the ECORAX brand name; and acetylene-based conductive additives for lithium-ion batteries and other applications. It operates in the United States, Brazil, rest of the Americas, Germany, South Africa, Italy, Spain, Turkey, France, Rest of EMEA, China, the Republic of Korea, and rest of Asia. The company was formerly known as Orion Engineered Carbons S.A. and changed its name to Orion S.A. in June 2023. Orion S.A. was founded in 1862 and is headquartered in Senningerberg, Luxembourg.

About Westlake Chemical Partners

Westlake Chemical Partners LP acquires, develops, and operates ethylene production facilities and related assets in the United States. The company’s ethylene production facilities primarily convert ethane into ethylene. It also sells ethylene co-products, such as propylene, crude butadiene, pyrolysis gasoline, and hydrogen directly to third parties on either a spot or contract basis. Westlake Chemical Partners GP LLC serves as the general partner of the company. Westlake Chemical Partners LP was founded in 1991 and is headquartered in Houston, Texas.