Office Depot Inc. (ODP) Raised to “Buy” at Zacks Investment Research
Office Depot Inc. (NASDAQ:ODP) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research note issued to investors on Monday. The firm presently has a $5.50 price target on the stock. Zacks Investment Research’s target price suggests a potential upside of 12.94% from the company’s current price.
According to Zacks, “After four consecutive quarters of negative earnings surprises, Office Depot posted an earnings beat in third-quarter 2016. However, it continues to battle a dismal top line that missed the estimate for the ninth straight quarter. Persistent weakness in the office products sector, technological advancements and stiff competition from online retailers are weighing on the company’s performance. Both the top and bottom lines continue to decline year over year. Nevertheless, management has undertaken a strategic review of business operating model, growth prospects and cost structure to bring itself back on the growth trajectory and decided to sell its international operations. These endeavors will take time to reap benefit. For now management anticipates total sales to be lower in fourth-quarter 2016 versus 2015 due to store closures, business disruption owing to merger related issues and tough market conditions.”
ODP has been the subject of several other research reports. Telsey Advisory Group reduced their price target on shares of Office Depot from $5.00 to $4.50 and set a “market perform” rating for the company in a report on Friday, October 28th. Morgan Stanley restated a “hold” rating and issued a $4.35 price target on shares of Office Depot in a report on Tuesday, August 16th. Finally, TheStreet upgraded shares of Office Depot from a “sell” rating to a “hold” rating in a report on Wednesday, August 10th. Seven investment analysts have rated the stock with a hold rating and three have assigned a buy rating to the stock. The company currently has an average rating of “Hold” and an average price target of $5.87.
Office Depot (NASDAQ:ODP) traded up 0.513% during midday trading on Monday, hitting $4.895. 3,311,906 shares of the stock were exchanged. Office Depot has a 12 month low of $3.01 and a 12 month high of $7.91. The company has a market cap of $2.59 billion, a PE ratio of 8.679 and a beta of 3.15. The firm’s 50 day moving average price is $3.74 and its 200 day moving average price is $3.59.
Office Depot (NASDAQ:ODP) last released its quarterly earnings results on Wednesday, November 2nd. The company reported $0.16 EPS for the quarter, topping analysts’ consensus estimates of $0.15 by $0.01. Office Depot had a net margin of 2.41% and a return on equity of 11.70%. The firm earned $2.84 billion during the quarter, compared to analysts’ expectations of $3.49 billion. During the same period in the previous year, the company earned $0.16 EPS. The firm’s revenue for the quarter was down 6.9% compared to the same quarter last year. On average, equities research analysts forecast that Office Depot will post $0.41 earnings per share for the current fiscal year.
The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, December 15th. Stockholders of record on Friday, November 25th will be issued a $0.025 dividend. This represents a $0.10 annualized dividend and a dividend yield of 2.05%. The ex-dividend date is Tuesday, November 22nd. Office Depot’s dividend payout ratio (DPR) is currently 17.54%.
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Hedge funds have recently added to or reduced their stakes in the stock. Whitebox Advisors LLC boosted its position in Office Depot by 304.8% in the second quarter. Whitebox Advisors LLC now owns 3,683,893 shares of the company’s stock valued at $12,194,000 after buying an additional 2,773,839 shares in the last quarter. Nisa Investment Advisors LLC boosted its position in Office Depot by 12.2% in the second quarter. Nisa Investment Advisors LLC now owns 36,700 shares of the company’s stock valued at $121,000 after buying an additional 4,000 shares in the last quarter. UBS Asset Management Americas Inc. boosted its position in Office Depot by 1.4% in the second quarter. UBS Asset Management Americas Inc. now owns 552,800 shares of the company’s stock valued at $1,830,000 after buying an additional 7,565 shares in the last quarter. Creative Planning boosted its position in Office Depot by 1,057.8% in the second quarter. Creative Planning now owns 146,937 shares of the company’s stock valued at $486,000 after buying an additional 134,246 shares in the last quarter. Finally, Brown Advisory Inc. boosted its position in Office Depot by 139.1% in the second quarter. Brown Advisory Inc. now owns 192,003 shares of the company’s stock valued at $636,000 after buying an additional 111,690 shares in the last quarter. 92.97% of the stock is currently owned by institutional investors and hedge funds.
About Office Depot
Office Depot, Inc (Office Depot) is a provider of office products and services. The Company sells products and services to consumers through three segments: North American Retail Division, North American Business Solutions Division and International Division. It operates under the Office Depot and OfficeMax brands.
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