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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Olin Corporation (NYSE:OLN) due to its excellent fundamentals in more than one area. OLN is a well-regarded dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, read the full report on Olin here.
Undervalued average dividend payer
OLN is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if OLN's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, OLN's share price is trading below the group's average. This bolsters the proposition that OLN's price is currently discounted.
OLN's ample net income is able to cover all of its dividend payments, which has been higher than the low-risk savings rate, sufficiently rewarding shareholders for taking on the risk of investing in the stock market. However, it is important to remember that dividend yields are a function of stock prices and corporate profits, which can be volatile.
For Olin, there are three important factors you should look at:
- Future Outlook: What are well-informed industry analysts predicting for OLN’s future growth? Take a look at our free research report of analyst consensus for OLN’s outlook.
- Historical Performance: What has OLN's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of OLN? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.