Is Westlake Corp. overvalued or undervalued?

As of 5 August 2025, the valuation grade for Westlake Corp. has moved from fair to risky, indicating a shift towards a more negative outlook. The company appears to be overvalued, particularly when considering its P/E ratio of 21, which is significantly higher than its peers such as Albemarle Corp. with a P/E of -101.94 and ChampionX Corp. at 15.52. Additionally, Westlake's EV to EBITDA stands at 6.64, which is lower than the industry average, suggesting potential inefficiencies in generating earnings relative to its enterprise value.
In terms of returns, Westlake Corp. has underperformed compared to the S&P 500 across multiple periods, with a year-to-date return of -25.90% versus the S&P 500's 12.22%, and a one-year return of -40.63% compared to 17.14% for the index. This underperformance reinforces the notion that the stock may be overvalued given its current financial metrics and market performance.