Praxair (PX) vs. Olin Corporation (OLN) Financial Analysis
Praxair (NYSE: PX) and Olin Corporation (NYSE:OLN) are both mid-cap basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, profitability, earnings and analyst recommendations.
This table compares Praxair and Olin Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
85.3% of Praxair shares are held by institutional investors. Comparatively, 92.6% of Olin Corporation shares are held by institutional investors. 0.2% of Praxair shares are held by insiders. Comparatively, 2.9% of Olin Corporation shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares Praxair and Olin Corporation’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Praxair||$10.92 billion||3.66||$3.54 billion||$5.35||26.12|
|Olin Corporation||$5.93 billion||0.96||$842.90 million||$0.25||137.00|
Praxair has higher revenue and earnings than Olin Corporation. Praxair is trading at a lower price-to-earnings ratio than Olin Corporation, indicating that it is currently the more affordable of the two stocks.
Praxair pays an annual dividend of $3.15 per share and has a dividend yield of 2.3%. Olin Corporation pays an annual dividend of $0.80 per share and has a dividend yield of 2.3%. Praxair pays out 58.9% of its earnings in the form of a dividend. Olin Corporation pays out 320.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Praxair has increased its dividend for 12 consecutive years.
This is a breakdown of current ratings for Praxair and Olin Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Praxair currently has a consensus target price of $136.89, indicating a potential downside of 2.04%. Olin Corporation has a consensus target price of $34.00, indicating a potential downside of 0.73%. Given Olin Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe Olin Corporation is more favorable than Praxair.
Volatility & Risk
Praxair has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500. Comparatively, Olin Corporation has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500.
Praxair beats Olin Corporation on 9 of the 17 factors compared between the two stocks.
Praxair, Inc. is an industrial gas company. The Company’s operations are organized into five segments, four of which have been determined on a geographic basis of segmentation: North America, Europe, South America and Asia. In addition, it operates its surface technologies business through its subsidiary, Praxair Surface Technologies, Inc., which represents the fifth segment. Its operations consist of two product lines: industrial gases and surface technologies. Its industrial gases product line centers on the manufacturing and distribution of atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases). It also designs, engineers and builds equipment that produces industrial gases primarily for internal use. Its Surface Technologies segment, operated through Praxair Surface Technologies, Inc., supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders.
About Olin Corporation
Olin Corporation is a manufacturer and distributor of chemical products, and ammunition. The Company operates through three segments: Chlor Alkali Products and Vinyls, Epoxy and Winchester. The Chlor Alkali Products and Vinyls segment manufactures and sells chlorine and caustic soda, ethylene dichloride and vinyl chloride monomer, methyl chloride, methylene chloride, chloroform, carbon tetrachloride, perchloroethylene, trichloroethylene and vinylidene chloride, hydrochloric acid, hydrogen, bleach products and potassium hydroxide. The Epoxy segment produces and sells a range of epoxy materials, including allyl chloride, epichlorohydrin, liquid epoxy resins and downstream products, such as converted epoxy resins and additives. The Winchester segment produces and sells sporting ammunition, reloading components, small caliber military ammunition and components, and industrial cartridges.
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