OLN's Earnings Outlook Improving; Maintain MP on Balanced Risk-Reward

研报英文原文证据摘录

OLN's Earnings Outlook Improving; Maintain MP on Balanced Risk-Reward

Olin - Block Summary Model

Income Statement 2025A 2026E 2027E 2028E

Revenue $6,781 $7,399 $7,832 $8,264

Consolidated EBITDA 652 706 806 1,016 Valuation

Depreciation 522 477 485 493 Our target price is based on a ~7.5x multiple on our 2027E

EBITDA, which we believe is a fair multiple for the mix of Consolidated EBIT 130 228 321 523

trough-like conditions in CAPV, structural headwinds in

Net Interest 188 173 173 173 epoxy and Winchester. Margin expansion from here will

Tax (43) (35) 41 97 require stability and confidence in earnings baseline for its

various platforms along with some sort of macro demand

Adjusted Net Earnings (43) 97 109 255 recovery. Overall, we see the risk/reward as balanced.

EPS $(0.38) $0.85 $0.96 $2.24

Upside Scenario $35.00

Cash Flow Statement 2025A 2026E 2027E 2028E

In the event OLN sees stronger-than-expected end-market

CFO 474 358 529 667 recovery (building/construction, industrial, durables, China),

Capex 226 194 200 200 higher chlor-alkali ECU margins, and a more meaningful

recovery in Epoxy economics, we could see 2027E EBITDA

Free Cash Flow (CFO - Capex) 248 164 329 467 push toward $850M, which together with a slightly higher

FCF/Share 2.15 1.44 2.89 4.10 target multiple of 8x could drive the stock to $35.

Net Change in Cash (8) 17 238 376 Downside Scenario $12.00

Balance Sheet 2025A 2026E 2027E 2028E Assuming a severe recessionary macro, we believe chlor-

Cash & Equivalents 168 187 425 800 alkali ECU margins would move roughly a third lower vs.

2024 levels, Winchester earnings will remain at trough

Short-term debt 714 632 632 632 as retail customers pare back on spending, and Epoxy a

Long-Term Debt 590 600 600 600 breakeven. With these assumptions, we could see EBITDA