Click to view the earnings moves in WLK
Can Westlake Break Its Historical Earnings Mold? Options Market and Stock History Suggest Cautious Expectations
Westlake (NYSE: WLK) dropped a major earnings update today, accompanied by news of sweeping asset closures and restructuring plans. While the options market anticipated a sizeable ±5.2% move, the actual price change came in at a rather modest +1.4%. So how does today stack up against historical earnings trends—and what could lie ahead for the stock?
Major News Moves: Restructuring Headlines Steal the Show
The company's big announcement centered on shuttering several North American plants and rationalizing its styrene and chlorovinyl production, impacting nearly 300 employees. Management framed these changes as a necessary response to challenging chemical markets—a development that could shape the company’s long-term margins, but also adds a layer of uncertainty in the short term.
WLK's Historical Earnings Playbook: Modest Moves, but Not Without Drama
Let’s dig into how WLK usually performs around earnings. Historically, Westlake's earnings day price action is, frankly, less dramatic than options markets tend to predict. Here’s a snapshot from the last dozen quarterly reports:
| Stock Performance | Earnings Move | Open Gap | Open to High | Open to Low | Open to Close |
|---|---|---|---|---|---|
| Average Return | -0.1% | -0.9% | +4.3% | -2.9% | +0.8% |
| % of Moves Up | 58.3% | 50.0% | 41.7% | ||
| % of Moves Down | 41.7% | 50.0% | 58.3% |
What does this mean in plain English? While the stock price opens down, on average (–0.9%), it tends to recover and drift slightly positive (+0.8%) by the close, although more than half the time, the move from open to close is actually lower. There’s also an average +4.3% spike to the day’s high, showing the potential for upside bursts—even if these don’t always last.
Curious to see more detailed earnings move breakdowns? Check the full historical performance page.
How Wild Are the Swings? The "Absolute" Move Table
| Stock Performance | Earnings Move | Open Gap | Open to High | Open to Low | Open to Close |
|---|---|---|---|---|---|
| Absolute Average Return | 4.9% | 5.2% | 4.3% | 2.9% | 2.0% |
| Max Absolute Return | 13.5% | 13.6% | 9.0% | 8.7% | 6.4% |
| Min Absolute Return | 0.2% | 0.6% | 0.0% | 0.0% | 0.0% |
While most moves are moderate, a wild day (double-digit swing) does crop up now and then. Options markets seem to "price in" more fireworks than actually materialize—something traders might keep in mind for future events.
After Earnings: Is There an Edge for Bulls or Bears?
| Stock Performance | 1 Day After Earnings | 2 Days After Earnings | 3 Days After Earnings | 1 Week After Earnings | 2 Weeks After Earnings |
|---|---|---|---|---|---|
| Average Return | +0.8% | +1.4% | -0.1% | -1.0% | +1.1% |
| % of Moves Up | 63.6% | 72.7% | 54.5% | 36.4% | 72.7% |
| % of Moves Down | 36.4% | 27.3% | 45.5% | 63.6% | 27.3% |
Post-earnings, WLK historically drifts upward over the next couple of days (average +1.4% at the two-day mark with 72.7% of cases in the green), but those gains don’t always last: at the one-week mark, the average return actually turns negative (–1.0%). Still, nearly three-quarters of the time, WLK bounces back within two weeks of earnings. Patterns like these could be of interest to those seeking a short-term post-earnings edge.
Options Traders: Where’s the Action Today?
Despite a light overall options volume (just 9 contracts), today’s most active single-leg contract was:
| Option Contract | 19-Dec-25 95 C |
| Volume | 8 |
| VWAP price | 0.05 |
| Open interest | 290 |
| Yesterday's closing price | 0.03 |
This far-out call suggests at least a few traders are making a long-term bet—perhaps eyeing a bigger turnaround, especially given the restructuring news. However, most option market participants played it cool, with overall activity well below what you’d see around a truly speculative or volatile earnings day.
Takeaway: Cautious Optimism, with an Eye on the Long Game
Westlake's earnings and asset rationalization may spark long-term shifts, but the historical odds favor a muted immediate move—just as we saw today. Still, the company’s decisive steps could reset the landscape for future earnings. Will options traders betting on bigger swings finally see them materialize, or will WLK stick to its usual script? Time, as always, will tell.
Want to analyze Westlake’s full earnings move stats for yourself? Check out the full historical data here.
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