Eyeing a few good DSP plans

I have been on the look out for a few good stocks with a DSP plan. The one stock that I have had in my tracking portfolio since last year is:

Omnova Solutions (OMN) (Google Yahoo Earnings Chart)

I began tracking Omnova, a small cap stock, starting April of last year when it was priced at $5.30. I had completed a New Account Application for Omnova under the then Bank of New Your Direct Stock Purchase Plan. I had signed up for monthly purchase of stock via direct debit from my checking account but had failed to enclose a check for the initial investment of $510.00. I assumed that the initial investment would also be directly debited from my checking account. However, the new account application came back with a letter stating that the check for the initial investment was not enclosed. I got sidetracked for a good part of 2007 from April through October due to family obligations so I never returned the application with the check. The company caught my eye again earlier this month when it released 1st Qtr 2008 results and the stock fell by almost 10%. It has since bottomed further to $2.98 (EOD April 11, 2008). That's a good 47% drop since I first looked at it last April.

After reviewing the 1st Qtr results here is my conclusion:


  1. Net sales rose 16% for the first quarter to $190.6 million from $164.8 million last year
  2. Net loss narrowed to $3 Million compared to a loss of $ 5.1 Million last year
  3. Operating profit of $2.5 million, down only $0.3 million despite $5.9 million higher raw material cost


  1. Raw material cost higher compared to last year
  2. As a consequence of increased raw materials cost the cost of goods sold increased 19%

All in all, it was not a bad quarter. There was not a lot of guidance provided for the remainder of the year but my guess is that costs will continue to be high, possibly increasing even more. I am keen on initiating a purchase in OMN using the DSP plan offered through BNY Mellon Shareowner Services. My timeframe for accumulating and holding the stock would be 2 years at the minimum. Here is the link to the InvestDirect Search page at BNY Mellon.


You can view the Omnova Solutions plan under the letter O. The plan highlights are:

Minimum Initial Investment: $500
Initial Check/Electronic Purchase Service Fee: $10
Initial Purchase Trading Fee: Company Paid

Minimum Periodic Electronic Purchase: $50
Periodic Check/Electronic Purchase Service Fee: Company Paid
Periodic Purchase Trading Fee: Company Paid
Dividend Reinvestment Service Fee: Company Paid
Dividend Reinvestment Trading Fee: Company Paid

Sales Transaction Service Fee: $10
Sales Transaction Trading Fee: $0.10/share:

It is a fairly inexpensive DSP plan. The only cost to participate in the plan is the initial purchase fee and the sales service/trading fee. There is no cost to periodic monthly purchase or reinvestment of dividends.