Sep. 17 at 3:50 PM
I Closed Out a 57% Gain in
$ODC
Five months ago I added
$ODC at ~
$43/share. Today I sold at
$68. The company Q3 results were one of the strongest quarters in its 85-year history, yet I closed the position.
Back in April I called ODC a “quiet compounder” hiding in plain sight. Vertical integration and a shift into higher-margin products like lightweight cat litter and renewable diesel filtration were boosting profitability and the market hadn’t caught up. Earnings had tripled in a few years and the stock still traded at single-digit earnings multiples.
Fast forward to now: Q3 revenue up 8% y/y to
$115.5M, net income up 50% to
$11.6M, EPS +51%. B2B margins >30%. Even with some retail hiccups the overall business is firing on all cylinders.
But the market has noticed. ODC has rerated from <8x earnings to 13x, EV/EBITDA from <8x to 11x, and P/FCF from 18x to 25x. My updated fair value is
$74/share.
https://www.beatingthetide.com/p/oil-dri-odc-57-percent-record-quarter-why-closing-position