Olin supercharges Winchester with AMMO Inc. deal—Wisconsin facility set to deliver $40m annual EBITDA

What is the strategic significance of Olin’s acquisition of AMMO Inc.’s ammunition assets?

Olin Corporation has completed its acquisition of AMMO Inc.‘s small caliber ammunition assets, incorporating them into its Winchester Ammunition business. The transaction includes a newly built, 185,000-square-foot manufacturing facility in Manitowoc, Wisconsin, and associated employees, as the company aims to expand its reach in the commercial, military, and law enforcement ammunition markets.

This strategic acquisition is expected to deepen vertical integration across the ammunition value chain while allowing Winchester to specialize in higher-margin, low-volume calibers. According to Olin’s President and CEO Ken Lane, the move supports the company’s capital allocation framework by delivering immediate earnings accretion and reinforcing its long-term vision for the Winchester brand.

How does the Manitowoc plant enhance Winchester’s production capabilities?

The Manitowoc facility introduces advanced brass shellcase manufacturing capabilities to the Winchester portfolio, which is expected to boost operational efficiency and output precision. Brett Flaugher, President of Winchester Ammunition, noted that the site will focus on high-value commercial, international military, and law enforcement calibers—segments that command higher margins and demand specialization. This will enable legacy plants within Winchester’s network to concentrate on high-volume production, enhancing the company’s competitive advantage in core segments.

With this operational shift, Olin aims to strengthen its ammunition supply chain, optimize its cost structure, and sharpen its strategic focus on both U.S. and international contracts.

What are the projected financial benefits of the deal?

Funded from available liquidity, the acquisition is forecasted to generate $10 to $15 million in adjusted EBITDA within the first year. Once fully integrated, Olin anticipates an annual EBITDA contribution of $40 million from the Manitowoc operations. The expected payback timeline is within three years, at a cost of 1.5 times adjusted EBITDA—an outcome that reflects the financial discipline underpinning Olin’s Winchester strategy.

Like its 2023 White Flyer acquisition, Olin has signaled a preference for targeted bolt-on acquisitions that strengthen core operations while remaining immediately accretive. This strategy aligns with shareholder value creation objectives and long-term industrial integration.

How does this acquisition fit within broader industry trends?

The U.S. ammunition manufacturing sector is undergoing consolidation, with major players increasing investments in automation and integration. Olin’s acquisition reflects this trend, positioning Winchester to better meet rising global demand for specialized cartridges and customized munitions amid geopolitical instability and increased military procurement cycles.

With the Manitowoc plant, Winchester is expected to gain further traction in export markets and in securing long-term supply contracts for defense and law enforcement agencies. The asset’s addition enhances Olin’s responsiveness to fluctuating demand cycles, market volatility, and evolving procurement standards.

What does sentiment analysis reveal about Olin’s stock performance and market reaction?

Despite the strategic logic and potential earnings uplift of the AMMO Inc. acquisition, Olin Corporation’s stock (NYSE: OLN) has faced a sustained decline over the past 12 months. As of April 17, 2025, shares closed at $20.89—marking a steep 61% year-over-year drop. This reflects broader headwinds in the chemicals business, especially due to weakening global demand and deceleration in the Chinese economy.

Analyst sentiment currently leans neutral to cautiously optimistic. Of the 17 analysts covering the stock, 3 rate it a ‘Buy,’ 13 recommend ‘Hold,’ and one suggests ‘Sell.’ Price targets range from $19.00 to $34.00, with a consensus median of $28.00—indicating a potential upside of roughly 34%.

Technically, Olin shares are trading below their 20-day, 50-day, and 200-day moving averages, highlighting sustained bearish momentum. The Relative Strength Index (RSI) stands at 37.69, suggesting the stock is nearing oversold territory, while a negative MACD reading reinforces the current downward trend.

How are institutional investors positioning themselves around Olin?

Institutional ownership of Olin Corporation remains strong, accounting for roughly 94.6% of the company’s shares. Key holders include BlackRock, Inc. with a 10.1% stake and The Vanguard Group with another 10%. In a notable insider move, CEO Kenneth Lane recently acquired 7,250 shares at $28.06 per share, a gesture interpreted by analysts as a vote of confidence in the company’s long-term outlook.

While institutional flows have not shifted significantly in recent quarters, there is growing interest in Olin’s transition strategy—especially as it continues to pivot toward higher-margin businesses such as specialty ammunition manufacturing.

Should investors buy, sell, or hold Olin stock now?

Based on current market dynamics and valuation, a ‘Hold’ recommendation appears prudent. Although Olin’s ammunition business is on a growth trajectory, its chemicals division continues to face cyclical challenges, which may limit short-term stock appreciation. The upcoming Q1 2025 earnings, scheduled for May 1, could serve as a critical inflection point. Analysts project full-year earnings per share (EPS) of $1.38 for FY2025 and $2.04 for FY2026, leaving room for positive revisions depending on ammunition segment performance.

The strategic acquisition of AMMO Inc.’s small caliber manufacturing assets reinforces Olin’s long-term growth in specialty ammunition. However, investors should remain cautious until macroeconomic pressures and sectoral headwinds in chemicals stabilize.

What’s next for Olin and Winchester?

Olin is expected to continue pursuing bolt-on acquisitions that align with its operational strengths and capital framework. The Manitowoc facility represents a meaningful leap in terms of specialization, automation, and profitability in Winchester’s ammunition value chain. If synergy projections hold, the deal could help stabilize Olin’s earnings amid pressure from the chemicals market and reposition Winchester as a global leader in specialized defense and commercial ammunition.

Going forward, stakeholders will be watching for further capital deployment, integration updates, and performance metrics tied to this newly acquired facility. With the global defense sector gaining momentum and the commercial ammunition segment seeing rising demand, Olin’s Winchester business appears poised for sustained, targeted expansion.