After DOW just got out of the way of Olin in the chlorine business and eliminated the supply overhang concern, I think you can expect solid medium term growth out of both parts of Olin. Coke is having growth problems, IIRC, and is a little pricier on a PE basis. You'll probably be better off in the medium term with Olin.
Before the DOW announcement, I would have said Olin is just one of many decent, dependable dividend and value plays out there. Now, it's an obvious buy.
Sentiment: Strong Buy
I am thinking of trading Coca-Cola for Olin. A little increase in dividend and possible better growth prospects. Should I pull the trigger? I already own Dupont and am a bit hesitant to add more commodity related stocks in this economy. Something tells me we will recover and manufacturing will lead the way. Your advice appreciated.
I want to thank everyone for commenting on my topic a month or so ago. It was nice to see others feeling my frustration, but better yet starting a discussion on Olin. After reading the transcript of the conference call, I walked away with the feeling that Olin management will not make big bold moves. They bought KA Steel to distribute more Olin product, and it really hasn't happened. Why? Winchester will continue steadily, but not more than that. The price of the chemicals is tied to the ups and downs of the general economy. Unless some bold move occurs, OLN is going to trudge along adding 10-15% in share price per year, and adding a 3 to 3.5% dividend kicker. I suppose you need a portfolio "anchor"', and OLN fills that bill.
They own Winchester ammunition. They can't make enough ammunition to keep up the demand for it. I think you will see them beating the estimates from now on. Besides the yield is pretty nice.
Tul ammo is not allowed at my local indoor range. They have a sign as it being inferior. That is not my opinion but that is what my LGD believes. Ammo will not catch up for a long long time. Just google homeland security and forbes. You will find out the 1.6 BILLION BULLET BUY is not made up. That will take years to fill. That is more bullets that were used in the wars for all services for the last 10 years and Homeland Security isn't at war the last time I looked.
I personally think this company would make a nice middle market LBO, and that they are potentially vulnerable to an activist.
Industry glamour should not determine the dividend, company financials should. A baby born the last time the dividend was raised could be in high school now. But mgmt and the board have had many raises in that time. Speak up owners! Next proxy, vote against all candidates...send a message!
They played with this ammo thing to long. Tul Ammo has made a hit in market share. Israel, flooded that market with 5.56. People know the PMC name. Restricting sales has just caused a glut and hording. When demand catches up with supply, and the hoarders and profiteers get nailed, the market will quickly vanish......
Makes sense for Win to go to ATK somewhat if ATK wants to get into gun making too. I also see the Winchester Division to remain very strong for the next 8 quarters, I do not see any let up. As this presidents term comes in an end in 3 years he will start with more and more executive orders be them within the law or not.. He knows even if they prove to be Unconstitutional they will take years to get rid of. Also remember the 1.6 billion bullet order by Homeland Security which extends out for a long time. That will keep the pressure on low inventories. When their new shift of ammo making comes on line that should add to the revenue and profits for that division although the margin may drop a bit but overall increase profits. Just my thoughts as I feel I have a better handle on the guns and ammo sector than the chemical sector they are in. But yes they are small enough to get bought out if the board wants that. I bet management does not welcome a buy out.
In my opinion, OLN should be merged with a larger company with a similar business in order to save money and perhaps find a larger market for its products. Or it should be split up, with Winchester going to ATK and chemicals going to OXY or some other chemical company which is in the same/similar business. Otherwise OLN only serves to enrich its executives and does little for the shareholders.
if you read the conference call transcript you don't get any bad vibes at all. actually the low eps estimate is due mostly to seasonal rev and price fluctuation. this stock should continue to rise to the upper 20's. schwab also says today they are a strong buy. glta longs
Great quarterly earnings but very poor next quarter guidance. That will weight on the stock pretty heavily. I don't know how you can forecast a decrease in earnings next quarter that is 60% below this quarter unless the Chlor Akali business is going to fall off the map.
We may go up 50¢ but at the end of the day I say we close even or maybe a little down. The stock is not going anywhere unless the dividend is increased, and not by 1¢ but by 5¢. Unfortunately the board declared the same dividend it did 14 years ago 20¢. Let's face it we are in a non glamorous industry.
Huge beat on 3Q EPs...sales up... highest EBITDA in history...Winchester has all-time record Q.....
How much of that will flow back to the owners of this company? Dividend has not been changed since 1999. Does board and mgmt care about shareholders? How many increases has mgmt had since 1999?