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Origin Materials is having a year most shareholders would like to erase. The stock has dived 25% in the last 30 days alone, bringing its one-year decline to a staggering 67%.
Even with this massive drop, the valuation remains a point of contention for many investors.
**The Valuation Disconnect**
* P/S Ratio: Despite the sell-off, $ORGN still trades at a 2.2x Price-to-Sales (P/S) ratio. To put that in perspective, nearly half of the companies in the U.S. Chemicals industry trade at a P/S below 1.1x.
* Revenue Slump: Over the past year, revenue has deteriorated by 28%, erasing almost all gains made over the last three years.
* Industry Comparison: While the rest of the Chemicals industry is predicted to grow by 5.3% in the next 12 months, Origin’s momentum is trending in the opposite direction.
Investors seem to be paying a premium for "potential," but with revenue stalling and the stock price lagging, existing shareholders are rightfully nervous.
Adding to the volatility, Origin Materials has recently agreed to pay a $9M settlement to resolve a lawsuit filed by investors who can already [submit claims](https://11th.com/cases/origin-investor-lawsuit) to get payment. This is centered on claims that the company misled the market regarding its Origin 2 plant. In 2023, the company shocked the market by announcing construction delays (pushing completion from 2025 to a phased approach ending in 2028), ajor cost overruns and a shift in product strategy.
That caused $ORGN to drop 66%, wiping out over $412 million in market value. The settlement aims to resolve claims that the company failed to disclose these critical setbacks and operational hurdles while the stock was trading at higher levels.
**The Bottom Line**
Origin Materials is in a high-risk, high-reward sector, but the combination of a high P/S ratio, declining revenue, and a $9M settlement for "misleading" investors makes it a controversial pick.
What’s your move? Are you buying the dip hoping for a "Phase 1" turnaround in 2026, or is the lack of revenue growth a dealbreaker?