Olin Corporation
OLN
$19.05
+2.31%
Olin Corporation is a global chemicals and ammunition manufacturer, operating through three segments: Chlor Alkali Products and Vinyls (CAPV), Epoxies, and Winchester. As the world's largest chlor-alkali producer by capacity and owner of the iconic Winchester brand, Olin holds a unique dual identity in the basic materials sector. The current investor narrative centers on the company's proposed merger with Huntsman, which has drawn scrutiny over deal terms and dilution concerns, while the stock has also been pressured by weak chlor-alkali pricing and a challenging demand environment. Recent quarterly results showed a net loss, underscoring the cyclical downturn and operational headwinds the company is navigating.…
OLN
Olin Corporation
$19.05
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Investment Opinion: Should I buy OLN Today?
Rating: Hold. The consensus recommendation is 'hold' with a mean rating of 2.86, and the average target price of $26.14 implies 41.2% upside, but the negative earnings and weak momentum warrant caution. The thesis is that OLN is undervalued on a PS basis, but the lack of near-term catalysts and operational headwinds limit upside.
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OLN 12-Month Price Forecast
The AI assessment is neutral with medium confidence. The stock is deeply undervalued on a PS basis, but the negative earnings and flat revenue suggest the market is pricing in a prolonged downturn. The forward PE indicates expectations of a recovery, but this is uncertain. The merger is a wildcard that could either unlock value or destroy it. I would upgrade to bullish if the merger is approved and chlor-alkali prices show signs of recovery, and downgrade to bearish if the merger fails or the company reports another significant loss.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Olin Corporation's 12-month outlook, with a consensus price target around $23.71 and implied upside of +24.5% versus the current price.
Average Target
$23.71
0 analysts
Implied Upside
+24.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$19 - $31
Analyst target range
Olin is covered by 14 analysts, with a consensus recommendation of 'hold' and a mean rating of 2.86 (where 1 is strong buy and 5 is sell). The average price target is $26.14, implying a substantial 41.2% upside from the current price of $18.51. The distribution of ratings includes a mix of hold, neutral, and underweight, with recent actions from firms like Morgan Stanley (Underweight) and KeyBanc (Overweight) indicating a lack of consensus. The low target of $21.00 and high target of $39.00 show a wide spread of $18, reflecting high uncertainty about the company's future, particularly regarding the Huntsman merger and chlor-alkali market recovery. The high target likely assumes successful merger synergies and a cyclical rebound, while the low target prices in continued margin compression and operational challenges.
Bulls vs Bears: OLN Investment Factors
Olin presents a classic value trap scenario: deep valuation discounts and analyst upside are offset by deteriorating fundamentals and a challenging cyclical environment. The bull case hinges on a successful merger and a chlor-alkali recovery, while the bear case is driven by continued margin compression and high leverage. Currently, the bearish evidence is stronger, given the negative earnings, flat revenue, and weak price action. The most critical tension is whether the Huntsman merger will create enough synergies to offset the cyclical downturn, as this will determine if the stock re-rates or continues to decline.
Bullish
- Deep Valuation Discount: OLN trades at a PS ratio of 0.35x, a 71% discount to the industry average of 1.2x, and well below its historical average of ~3.0x (2021-2023). This suggests the market has priced in significant pessimism, offering potential upside if earnings recover.
- Analyst Target Upside: The average analyst price target is $26.14, implying a 41.2% upside from the current price of $18.51. Even the low target of $21.00 suggests a 13.5% upside, indicating that sell-side analysts see the stock as undervalued at current levels.
- Positive Forward Expectations: The forward PE of 19.43x and estimated EPS of $1.82 for the next fiscal year imply a significant earnings recovery from the current negative EPS of -$0.018. This suggests the market expects a cyclical rebound and successful merger synergies.
- Strong Free Cash Flow: Despite a net loss in Q4 2025, Olin generated $247.9 million in free cash flow over the trailing twelve months. This provides a cushion for debt servicing and potential shareholder returns, supporting the stock's downside.
Bearish
- Persistent Revenue Stagnation: Revenue has been flat, with Q4 2025 revenue of $1.665 billion, down 0.37% YoY, and fluctuating between $1.64B and $1.76B over the past year. This indicates no growth momentum, making it difficult to justify a re-rating.
- Negative Profitability: Olin reported a net loss of $85.7 million in Q4 2025, with a net margin of -5.15% for the quarter and -0.63% TTM. The gross margin collapsed to just 1.88% in Q4, reflecting severe pricing pressure in chlor-alkali and epoxies.
- High Debt Burden: The debt-to-equity ratio is 1.71, indicating high leverage. With interest expenses of $46.2 million in Q4, the company's ability to service debt is strained, especially if earnings remain depressed.
- Merger Dilution Concerns: The Huntsman merger is seen as dilutive to Huntsman shareholders, but it also raises concerns about Olin's integration risks and potential overpayment. The market has reacted negatively, with OLN stock down 35.3% in the last three months.
OLN Technical Analysis
OLN is in a pronounced downtrend, with the stock closing at $18.51 on July 31, 2026, down 2.27% over the past year and 35.30% over the past three months. The current price sits near the bottom of its 52-week range, at approximately 60.8% of the range (calculated as (18.51 - 17.7375) / (30.46 - 17.7375)), indicating the stock is closer to its low than its high, reflecting persistent selling pressure and weak investor sentiment. The 52-week low of $17.74 is just 4.3% below the current price, suggesting the stock is testing critical support levels.
Beta
1.20
1.20x market volatility
Max Drawdown
-38.6%
Largest decline past year
52-Week Range
$18-$30
Price range past year
Annual Return
+2.6%
Cumulative gain past year
| Period | OLN Return | S&P 500 |
|---|---|---|
| 1m | -4.9% | +3.6% |
| 3m | -33.9% | +5.1% |
| 6m | -18.6% | +13.8% |
| 1y | +2.6% | +22.2% |
| ytd | -11.6% | +13.1% |
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OLN Fundamental Analysis
Olin's revenue has been essentially flat, with the most recent quarter (Q4 2025) reporting revenue of $1.665 billion, a slight decline of 0.37% year-over-year. The multi-quarter trend shows revenue fluctuating between $1.64 billion and $1.76 billion over the past year, indicating stagnation rather than growth. The company's three segments—Chlor Alkali, Epoxies, and Winchester—contributed $856.4 million, $359.3 million, and $449.4 million respectively, with the chlor-alkali segment being the largest but also the most cyclical and currently pressured by weak pricing. This flat revenue trajectory, coupled with a negative net margin of -0.63% (TTM), highlights the challenges in the current chemical cycle.
Quarterly Revenue
$1.7B
2025-12
Revenue YoY Growth
-0.4%
YoY Comparison
Gross Margin
1.9%
Latest Quarter
Free Cash Flow
$247900000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is OLN Overvalued?
Given that Olin's trailing twelve-month net income is negative (EPS of -$0.018), the price-to-sales (PS) ratio is the most appropriate valuation metric, as PE ratios are not meaningful for loss-making companies. The current PS ratio is 0.35x, which is significantly below the company's historical average of around 3.0x seen in 2021-2023, indicating a deep valuation discount. The forward PE of 19.43x suggests the market expects earnings to recover, but the gap between the negative trailing EPS and positive forward estimates implies a substantial expected turnaround. Compared to the industry average PS ratio of approximately 1.2x (based on typical chemical sector multiples), Olin trades at a 71% discount, reflecting the market's pessimism about near-term earnings power.
PE
-56.3x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 4x~37x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
8.6x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are significant. Olin's high debt-to-equity ratio of 1.71 and interest expenses of $46.2 million per quarter strain cash flow, especially with negative net income. The company's gross margin collapsed to 1.88% in Q4 2025, indicating severe pricing pressure in its core chlor-alkali segment, which accounts for 55% of sales. Revenue has been stagnant, with no growth over the past year, and the negative TTM net margin of -0.63% suggests the company is struggling to cover fixed costs. Free cash flow of $247.9 million provides some buffer, but it could be insufficient if the downturn persists.
FAQ
The key risks are: 1) Financial: high debt-to-equity of 1.71 and negative net income, which could lead to dividend cuts or equity dilution. 2) Competitive: weak chlor-alkali pricing and oversupply in the chemical industry. 3) Merger-specific: the Huntsman merger could fail or be dilutive, as seen in the market's negative reaction. 4) Macro: the stock is highly cyclical and sensitive to economic downturns, with a beta likely above 1.5. The most severe risk is a combination of merger failure and continued margin compression, which could push the stock below $17.74.
The 12-month forecast is uncertain, with three scenarios: Bull case (25% probability) targets $26.14-$39.00 if the merger succeeds and chlor-alkali recovers; Base case (50% probability) targets $21.00-$26.14 if the merger closes but synergies are modest; Bear case (25% probability) targets $15.00-$17.74 if the merger fails or the downturn worsens. The most likely scenario is the base case, assuming the merger closes and the company stabilizes. The average analyst target of $26.14 implies a 41.2% upside, but this is contingent on execution.
OLN is undervalued on a price-to-sales basis, trading at 0.35x versus the industry average of 1.2x, a 71% discount. It is also below its historical average PS of ~3.0x. However, the negative earnings make PE comparisons meaningless. The forward PE of 19.43x suggests the market expects a recovery, but this could be optimistic. The market is pricing in a prolonged downturn, and the valuation implies that investors are skeptical of near-term profitability. If the company returns to profitability, the stock is significantly undervalued; if not, it could be fairly valued or even overvalued.
OLN is a high-risk, high-reward opportunity. The stock trades at a 71% discount to the industry on a PS basis, and analysts see 41.2% upside to the average target of $26.14. However, the company is currently unprofitable, with a negative TTM EPS, and faces significant merger and cyclical risks. It could be a good buy for investors who believe in a cyclical recovery and merger synergies, but it is not suitable for risk-averse investors. The downside is limited to the 52-week low of $17.74, but if the merger fails, the stock could fall further.
OLN is more suitable for long-term investment (3-5 years) due to its cyclical nature and the potential for the merger to create value over time. The stock is highly volatile, with a 35% drawdown in three months, making it risky for short-term trading. The dividend yield of 3.84% provides some income, but the payout ratio is negative, indicating the dividend is not well-covered. For long-term investors with a high risk tolerance, OLN could offer significant upside if the cyclical recovery materializes. Short-term traders should be cautious given the negative momentum.