Olin (OLN) AI Stock Analysis

• Market Cap: $2.52B
• Dividend Yield: 3.65%
• Average Volume (3M): 1.84M
• Price to Earnings (P/E): 43.2
• Beta (1Y): 1.29
• Revenue Growth: -1.13%
• EPS Growth: -81.74%
• Country: US
• Employees: 7,676
• Sector: Basic Materials
• Sector Strength: 71
• Industry: Chemicals - Specialty
• EPS (TTM): 0.04
• Shares Outstanding: 115,135,690
• 10 Day Avg. Volume: 1,882,874
• 30 Day Avg. Volume: 1,836,569
• PEG Ratio: -0.88
• Price to Book (P/B): 1.15
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 12.22
• Enterprise Value/Market Cap: 2.15
• Enterprise Value/Revenue: 0.21
• Enterprise Value/Gross Profit: 8.07
• Enterprise Value/Ebitda: 1.56
• 1Y Price Target: $24.62
• Price Target Upside: 16.85% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 14

• Rating: 50 Neutral
• Price Target: $23.00 ▲(9.16%Upside)

Olin's overall stock score reflects a combination of mixed financial performance, neutral technical indicators, and valuation concerns. The earnings call provided balanced insights with strengths in some segments but also significant challenges. The high leverage and valuation concerns are notable risks, while strong cash flow and strategic initiatives offer some positive outlook.

Positive Factors

Cash Flow

Olin Corporation has raised its free cash flow estimates due to better working capital and lower capital expenditures, providing flexibility for capital deployment.

Financial Performance

Olin's Q1 results topped estimates largely due to Chlor-alkali EBITDA coming well ahead of expectations, indicating relative stability in chlorine and caustic prices.

Market Position

Olin is believed to remain better positioned compared to other commodity chemical peers to weather the Trump administration policies, with limited impact from a trade war and much to gain from a reduction in the corporate tax rate.

Negative Factors

Demand and Supply Challenges

A weaker than expected backdrop and incrementally sluggish demand for chlorine and vinyls in particular due in part to slower than expected building and construction activity.

Earnings Outlook

Significant negative earnings revisions are likely with 1Q25 EBITDA guidance well below expectations.

Operational Disruptions

An outage associated with the chlorine leak at Olin's Freeport facility.

Olin Business Overview & Revenue Model

Company Description

Olin Corporation is a leading American manufacturer and distributor of chemical products and ammunition. The company operates in two primary sectors: Chemicals and Ammunition. Its Chemicals segment, known as Olin Chlor Alkali Products and Vinyls, produces chlorine, caustic soda, and other chemical products utilized in various industrial applications. The Ammunition segment, branded as Winchester, is one of the largest ammunition suppliers in the United States, serving commercial, military, and law enforcement markets.

How the Company Makes Money

Olin Corporation generates revenue primarily through the sale of its chemical products and ammunition. The Chemicals segment, which is a significant portion of Olin's business, makes money by producing and selling chlorine, caustic soda, and other related chemical products. These products are sold to a wide range of industries including paper, textiles, and water treatment facilities. The Ammunition segment generates revenue by manufacturing and selling ammunition products under the Winchester brand. This segment caters to commercial markets, military contracts, and law enforcement agencies. Olin's earnings are also influenced by strategic partnerships and long-term supply agreements, particularly in the chemicals sector, which help stabilize revenue streams and ensure consistent demand for its products.

Olin Financial Statement Overview

Summary

Olin shows a mixed financial performance. While it has a healthy gross profit margin of 33.13%, a low net profit margin of 0.94% indicates issues in converting revenue into profit. Revenue decline and high leverage are concerns, but strong cash flow generation provides some stability.

Income Statement

Olin shows a mixed performance in the income statement. The TTM Gross Profit Margin is healthy at 33.13%, indicating efficient cost management relative to revenue. However, the Net Profit Margin for the TTM is low at 0.94%, reflecting challenges in converting revenue into profit. Revenue has declined over the years, with a significant drop of 30.16% from 2022 to 2023, highlighting a concerning trend in revenue growth. The EBIT and EBITDA margins are moderate at 3.88% and 10.06% respectively, suggesting some operational efficiency but also room for improvement.

Balance Sheet

The balance sheet reveals a relatively high Debt-to-Equity ratio of 1.60, which could imply higher financial risk due to significant leverage. The Return on Equity for the TTM is notably low at 3.01%, indicating a modest return on shareholders' investments. The equity ratio stands at 26.62%, suggesting a moderate level of financial stability. While there are strengths, such as a stable asset base, the high leverage remains a key concern.

Cash Flow

Olin's cash flow statement reflects a solid cash generation capability. The Operating Cash Flow to Net Income ratio is robust at 6.88 for the TTM, indicating strong cash flow relative to net income. However, the Free Cash Flow has decreased, with a decline of 37.77% from the previous year. The Free Cash Flow to Net Income ratio stands at 3.12, showing that the company is generating sufficient cash flow, albeit with some reductions over time. Overall, cash flow stability is a positive aspect of Olin's financials.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	6.55B	6.54B	6.83B	9.38B	8.91B	5.76B
Gross Profit	673.60M	737.50M	1.16B	2.18B	2.29B	383.40M
EBITDA	659.30M	844.30M	1.30B	2.44B	2.32B	-142.50M
Net Income	61.40M	108.60M	460.20M	1.33B	1.30B	-969.90M
Balance Sheet
Total Assets	7.66B	7.58B	7.71B	8.04B	8.52B	8.27B
Cash, Cash Equivalents and Short-Term Investments	174.00M	175.60M	170.30M	194.00M	180.50M	189.70M
Total Debt	3.27B	3.15B	3.02B	2.94B	3.16B	4.23B
Total Liabilities	5.62B	5.52B	5.44B	5.50B	5.87B	6.82B
Stockholders Equity	2.04B	2.02B	2.23B	2.54B	2.65B	1.45B
Cash Flow
Free Cash Flow	191.80M	308.10M	738.30M	1.69B	1.54B	119.50M
Operating Cash Flow	336.20M	503.20M	974.30M	1.92B	1.74B	418.40M
Investing Cash Flow	-271.40M	-283.70M	-340.80M	-259.70M	-197.40M	-835.70M
Financing Cash Flow	-40.70M	-212.60M	-656.90M	-1.65B	-1.55B	371.00M

Olin Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 21.07
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OLN, the sentiment is Neutral. The current price of 21.07 is above the 20-day moving average (MA) of 20.59, above the 50-day MA of 20.70, and below the 200-day MA of 30.50, indicating a neutral trend. The MACD of 0.19 indicates Negative momentum. The RSI at 53.20 is Neutral, neither overbought nor oversold. The STOCH value of 80.71 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OLN.

Olin Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HWKN	74 Outperform	$3.20B	38.10	19.47%	0.47%	6.01%	12.38%
HWKN	74 Outperform	$3.20B	38.10	19.47%	0.47%	6.01%	12.38%
AVNT	71 Outperform	$3.03B	30.65	4.32%	3.14%	3.58%	-5.17%
AVNT	71 Outperform	$3.03B	30.65	4.32%	3.14%	3.58%	-5.17%
IOSP	67 Neutral	$2.16B	81.68	2.21%	1.94%	-7.91%	-81.73%
IOSP	67 Neutral	$2.16B	81.68	2.21%	1.94%	-7.91%	-81.73%
Sector *	62 Neutral	$10.15B	9.75	-0.17%	2.87%	2.22%	-32.49%
SSL	57 Neutral	$3.15B	―	-28.05%	2.00%	-4.31%	-1421.83%
SSL	57 Neutral	$3.15B	―	-28.05%	2.00%	-4.31%	-1421.83%
OLN	50 Neutral	$2.52B	43.19	2.94%	3.65%	-1.13%	-81.74%
ASH	48 Neutral	$2.40B	21.03	-3.02%	3.09%	-7.63%	-157.37%
ASH	48 Neutral	$2.40B	21.03	-3.02%	3.09%	-7.63%	-157.37%

Olin Corporate Events

Olin Corporation Holds Annual Shareholder Meeting

On May 1, 2025, Olin Corporation held its annual meeting of shareholders, where the board approved a reduction in its size from ten to nine directors following the completion of Mr. C. Robert Bunch’s term. Shareholders elected nine directors, approved executive compensation, and ratified KPMG LLP as the independent auditor for 2025. Olin also declared a quarterly dividend of $0.20 per share, marking its 394th consecutive quarterly dividend. In its first quarter 2025 financial results, Olin reported a net income of $1.4 million, a significant decrease from the previous year, with adjusted EBITDA of $185.6 million. The company experienced higher chlorine demand, leading to a delay in planned maintenance, and announced cost-saving measures and reduced capital spending. Despite challenges in the epoxy market and Winchester sales, Olin remains focused on a value-first approach and expects stable performance in its chemical businesses.