Olin Corporation (OLN, Financial) has revised its financial strategy to navigate the uncertain economic environment, aiming for cost savings of $50 million to $70 million, surpassing its earlier projections. The company has also reduced its annual capital expenditure by approximately $25 million. In a bid to enhance its financial resilience, Olin has extended the maturities of its senior bank credit agreement from 2027 to 2030 and issued $600 million in bonds due in 2033, using the proceeds to repay bonds maturing in 2025 and 2027.
For the second quarter, Olin anticipates performance from its Chemicals businesses to mirror that of the first quarter, despite higher costs associated with postponed maintenance. The Chlor Alkali Products and Vinyls segment is expected to benefit from seasonal volume upticks and stronger caustic soda prices. However, the global demand for epoxy remains weak, facing competitive pressure from subsidized Asian markets. Still, efforts are focused on reducing costs and expanding the formulated solutions business.
The Winchester division remains under pressure due to decreased consumer spending and high inventory levels, though a sequential improvement is anticipated as demand increases with seasonal trends and enhanced military sales. Overall, Olin forecasts second-quarter adjusted EBITDA to be between $170 million and $210 million, maintaining a steady course on its value-first commercial strategy.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 18 analysts, the average target price for Olin Corp (OLN, Financial) is $30.00 with a high estimate of $70.00 and a low estimate of $19.00. The average target implies an upside of 38.57% from the current price of $21.65. More detailed estimate data can be found on the Olin Corp (OLN) Forecast page.
Based on the consensus recommendation from 19 brokerage firms, Olin Corp's (OLN, Financial) average brokerage recommendation is currently 2.7, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Olin Corp (OLN, Financial) in one year is $51.32, suggesting a upside of 137.04% from the current price of $21.65. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Olin Corp (OLN) Summary page.
