Examination on Olin Corporation

 Essay regarding Analysis on Olin Corporation

The Analysis and Valuation of

Olin Corporation (OLN)

By At the Demmon

Published on 12 , 13, 2011



Industry and company1

Chlorgas Alkali1


Management and Ownership3

Latest developments3


Exploration of financial statements3

Discussion of monetary ratios4





Investment thesis5

Essential value drivers5

Risks, caveats, and exposures6


Summary of essential series7

Selected growth rates7

Components of measured average expense of capital (WACC)7

Free cash flows and economic profit7



As a pupil analyst to get Drake University's Krause Problem Fund, I use conducted economic analysis and valuation of Olin Company, a maker of Chlor Alkali companies Winchester ammo. Olin has undergone restructuring and bought the other half of a previously owned subsidiary, that i expect to lessen operating costs. The current selling price undervalues the business. Therefore , I suggest we order Olin intended for our portfolio. The following is the detailed effects of my personal analysis. BACKDROP

Industry and company

Olin Corporation is a manufacturer of two key segments: Chlor Alkali companies Winchester ammo. The company has existed for over 100 years and is an important market player within United states. Headquartered in Clayton, MO, Olin provides multiple developing facilities with the United States and one site in Canada. Chlor Alkali

Olin is the third largest maker of Chlor Alkali products and the largest developer of industrial bleach in North America according to data via Chemical Market Associates, Incorporation.. Chlorine and caustic soft drink are the co-products Olin makes in set ratios called Electrochemical Devices (ECU) through the electrolysis of salt. Both equally chlorine and caustic soda are used within the manufacturing of bleach. A whole list of end-products can be found on page 30 from the appendix. Competitive environment

Chlor Alkali sector is a commodity business with product differentiation largely based upon price. Production is very capital intensive, which usually does make some economical barriers to entry. The two largest manufacturers, DowChemical and OxyChem make use of most of many to production other downstream products. Olin differentiates by itself from rivals by concentrating the service provider market. Sales and growth

This is a cyclical sector. This cyclicality arises mainly because supply is limited by the physical capacity of producing facilities and ability to sell off the co-product. Given these are commodity goods, prices are incredibly responsive to within supply and demand. Timing capacity progress with the routine leads to a growth in revenue. Demand for end-products ultimately pushes demand for Chlor Alkali. The power advantage United states has by using natural gas instead of crude oil has exploded exports of end-products. Customers

Most of sales are to the merchant marketplace. The company can capture a greater share of the merchant chlorine market than its general share of the market capability because it focuses on the merchant market rather than using the items in downstream production. Costs and Suppliers

Almost 50% of creation costs can be raw materials. The 2 major demands are electricity and salt. Electricity originates from coal, hydroelectric, natural gas and nuclear electric power. Regulatory

Olin must adhere to legislation regarding the environment, such as air, normal water and property quality, which usually requires capital expenditures and increases operation costs. The company has programs in place to reduce waste and prevent pollution. Laws was approved in August 2009 around the use of mercury cell technology, but out of date without achievement. This would have got increased the expenses of operating mercury cell capacity, of which Olin provides one center. Since it is uncertain whether something similar...

Bibliography: " 10-Year Treasury Constant Maturity Rate (DGS10). " WENDY - St Louis Provided. 01 November. 2011..

" CMAI Completes 2011 World Chlor-Alkali Analysis. " PR Newswire, 18 Nov. 2010. 08 December. 2011..

" Consumer Cost Index for All Urban Buyers: All Items (CPIAUCSL). " FRED -- St . Paillette Fed. 01 Nov. 2011..

" Major Domestic Item (GDPA). " FRED -- St . Paillette Fed. 01 Nov. 2011..

" Weapons and Ammunition Stores Sector Market Research Record Now Available by IBISWorld. " PRWeb, 12-15 Nov. 2011. 08 Dec. 2011..

Koller, Tim, Marc Goedhart, and David Wessels. Valuation. fifth Edition. Hoboken, New Jersey: Ruben Wiley & Sons, Inc., 2010.

Olin Corporation. " 2006 Total annual Report. ” Clayton, MO, 2006, 71.

Olin Company. " 3 years ago Annual Survey. ” Clayton, MO, 3 years ago, 20.

Olin Corporation. " 2010 Gross annual Report. ” Clayton, MO, 2010, a couple of, 5, 7-8.

Olin Company. " Quarterly Report. ” Clayton, MO, 35 Sept, 2011, 8.

Rupp, Frederick D

Yahoo! Finance – Key Statistics. Yahoo! Finance. 10 December. 2011.


[ two ]. Olin Corporation. " 2010 Total annual Report. ” Clayton, MO, 2010, 7.

[ 3 ]. Olin Company. " 2010 Annual Statement. ” Clayton, MO, 2010, 5.

[ 5 ]. Olin Corporation. " 2010 Gross annual Report. ” Clayton, MO, 2010, almost 8.

[ 6 ]. Yahoo! Fund – Crucial Statistics. Google! Finance. 10 Dec. 2011.

[ 7 ]

[ 8 ]. Olin Company. " 3 years ago Annual Statement. ” Clayton, MO, 2007, 20.

[ being unfaithful ]. Rupp, Joseph D. " Olin Corporation Shareholder Letter. ” Clayton, MO, 2010, 1 .

[ 10 ]. FRED -- St . Paillette Fed. 01 Nov. 2011..

[ 11 ]. Koller, Bernard, Marc Goedhart, and David Wessels. Value. 5th Copy. Hoboken, New Jersey: John Wiley & Kids, Inc., 2010. p238.

[ doze ]. " CMAI Wraps up 2011 Universe Chlor-Alkali Analysis. " PUBLIC RELATIONS Newswire, 18 Nov. 2010. 08 Dec. 2011..

[ 13 ]. " Guns and Ammunition Shops Industry Market Research Report Available nowadays from IBISWorld. " PRWeb, 15 Nov. 2011. '08 Dec. 2011..

[ 14 ]. Acme Usa Corporation. " 2010 Twelve-monthly Report. ” Fairfield, CT, 2010, thirty-two.

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