ODP Investment Analysis Report & Stock Research, Office Depot, Inc.

Office Depot, Incorporated (ODP)

ODP Stock Report

2-Year Price History

View Larger ODP Chart
NYSE:ODP
$5.68
(2/9 3:27PM)
+5.6%
Open$5.49 Mkt Cap$1.5 Billion
High$5.7 52Wk High$7.84
Low$5.35 52Wk Low$0.59
Volume5.0 Million Avg Vol 10D4.5 Million

Ockham's Rating/Recommendation Summary

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ODP Revenue

Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company's stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 10 years. For, ODP the high and low end of the Price to Sales per share ratios are 0.52x and 0.24x respectively.

Notice that ODP's current Price to Sales per share ratio is 0.12x, which is quite a bit below what we consider a normal Price to Sales ratio for this stock. Given normal conditions and a price of $5.48, ODP is 68% below where we would expect to see it. This will beneficially factor into our final analysis of ODP as it is not often that this stock sinks to these levels.

ODP Cash Earnings

Price to Cash Earnings analysis is inappropriate for this company due to anticipated negative cash flows for this year. A negative cash flow presents many complications when comparing the company's current value to historically normal valuations. Clearly, when a company fails to earn a profit, it should be a concern for investors. As such, we have taken a negative view on ODP from a cash perspective. We should point out that this metric is a significant element in Ockham’s methodology for analyzing the outlook for any company. Many young companies have come through difficult times like this before; these companies have an opportunity to grow revenue appropriately to bring them around to profitablity. However, for mature company's with a history of positive cash flow this can be much more distressing. Therefore, for ODP, our overall valutaion is now more dependent on the Price to Sales analysis, and investors should be cautious with a company with very limited, if any, positive cash earnings.

ODP Dividends

While it is not necessary to pay an attractive dividend or a dividend at all, to receive a positive rating from Ockham, we view dividends as an additionally helpful measure in determining the future potential of any company. As far as our investing methodology goes, it is not necessary to pay a dividend in order to get a favorable rating, so as for right now ODP gets a neutral rating for the dividend portion of the model. As you can see, we are not receiving historical dividend information from our data provider on ODP at this time.

Peer Comparison

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Office Depot, Inc. Industry Grouping

(2/8/2010)
Company Ticker Market Cap (Ml) Latest
Price
Price/Cash Earnings Price/Sales 5-Yr. Rev.
Growth Rate
5-Yr.
Avg. ROE.
Current 10-Yr. Range* Current 10-Yr. Range*
Peer Company Averages (not including ODP) 9.81 2.11 » 19.64 0.83 0.20 » 1.02 7.63% 38.99%
*10 year range does not include current year values
Tractor Supply Company TSCO $1.8 Billion $50.14 11.55 2.05 » 20.93 0.57 0.09 » 1.15 15.35% 16.16%
Suburban Propane Partners L.P. SPH $1.6 Billion $44.66 7.90 3.63 » 34.31 1.37 0.43 » 1.44 -2.65% 56.58%
Ferrellgas Partners L.P. FGP $1.5 Billion $21.40 12.72 3.21 » 14.67 0.76 0.27 » 0.99 10.20% 18.36%
Office Depot, Inc. ODP $1.5 Billion $5.38 -1.00 5.25 » 17.45 0.12 0.01 » 0.86 3.24% 10.38%
Sally Beauty Holdings, Inc. SBH $1.4 Billion $7.91 9.81 0.05 » 19.89 0.58 0.00 » 0.74 n/a 4.71%
Inergy Holdings, LP NRGP $1.4 Billion $66.98 7.08 1.63 » 8.38 0.89 0.18 » 0.76 n/a 99.15%
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9:46A, Jan. 20,2010 ODP $6.47 Office Depot, Inc.
Squawk On The Street

Office Depot, Incorporated News Appeared on Squawk On The Street

The latest news on Squawk On The Street in regards to ODP came through on RazorWire recently.

The crowd at The Motley Fool does not like ODP and believes that it will Underperform. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, ODP has been less covered in the news compared to the rest of our universe of stocks. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on ODP.

“… well, as you said, OFFICE DEPOT is based in south florida and so we've seen our fair share of disasters. And so we set up a foundation years ago, the OFFICE DEPOT foundation, to ... …”

9:39A, Jan. 20,2010 ODP $6.50 Office Depot, Inc.
Squawk On The Street

Heard on Squawk On The Street: CEO of ODP Discussed

Office Depot, Incorporated's CEO is obviously vital to his company, so we believe any news covering him is worth knowing for investors.

Office Depot, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals. We noticed recently that in comparison to all other stocks we analyze in the news; ODP has received less coverage from the financial media in business television and blogs. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform.

“… plus the ceo of OFFICE DEPOT on what the company is doing in haiti and on the u. S. Economy and on that business spending indicator we just ended that segment with. …”

3:03P, Jan. 15,2010 ODP $6.59 Office Depot, Inc.
Closing Bell

Analyst Opinion on ODP the Topic for Closing Bell

Analysts' opinions can often carry a lot of weight, especially when they make major news and are covered on Closing Bell.

As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, ODP has been less covered in the news compared to the rest of our universe of stocks. The crowd at The Motley Fool does not like ODP and believes that it will Underperform. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on ODP.

“… We also watches OFFICE DEPOT and staples have a pretty decent day as well. Upgrade, schlumberger got one, raised from buy to hold at jeffries. …”

1:20P, Jan. 15,2010 ODP $6.61 Office Depot, Inc.
Power Lunch

See More News on ODP from Power Lunch

The latest news on Power Lunch in regards to ODP came through on RazorWire recently.

The crowd at The Motley Fool does not like ODP and believes that it will Underperform. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on ODP. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, ODP has been less covered in the news compared to the rest of our universe of stocks.

“… Staples up as well, OFFICE DEPOT has turned negative. A modest move to the downside by 1. 75%. Dow industrials down by 138. Just a few points off the lows of the day. > > …”

11:03A, Jan. 15,2010 ODP $6.72 Office Depot, Inc.
The Call

News Developing on The Call for ODP

The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Office Depot, Incorporated.

Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Office Depot, Incorporated underperforming. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Office Depot, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on ODP because it trades within the price range that we would expect given current market conditions and fundamentals.

“… In the labor market you've seen staples and OFFICE DEPOT rising on the back of that as well. Schlumberger was raised to a buy over at jefferies and then kellogg was upgraded to ... …”

3:26P, Dec. 30,2009 ODP $6.53 Office Depot, Inc.
Closing Bell

Interested in ODP? See What the Pundits Said on Closing Bell

Office Depot, Incorporated is one of the thousands of companies that Ockham has news analytics on, and it was recently discussed on Closing Bell.

Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Office Depot, Incorporated underperforming. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Office Depot, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on ODP because it trades within the price range that we would expect given current market conditions and fundamentals.

“… OFFICE DEPOT down about 5%, diliards are also down about 5. Ann taylor, macy's off here the retail index though, longer term on the year, at least morgan stanley retail, 81%. …”

2:39P, Dec. 22,2009 ODP $7.01 Office Depot, Inc.
Street Signs

Holding ODP Stock? See What Is Being Discussed on Street Signs

Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on ODP from Street Signs.

When taking into account the amount of news coverage each stock normally sees as a percentage of the total, Office Depot, Incorporated has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on ODP because it trades within the price range that we would expect given current market conditions and fundamentals. Interestingly, overall sentiment looks bearish according to the Motley Fool's CAPS survey, as most of their users see Office Depot, Incorporated underperforming.

“… you'll see staples moving up, OFFICE DEPOT a resurgeon against in spend for deck. You will see if if jabil goes those are the quiet manufactures of parts and assemblers of > > …”

11:15A, Dec. 01,2009 ODP $6.39 Office Depot, Inc.
Fox Business

Office Depot, Incorporated Was Talked About by Fox Business

The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Office Depot, Incorporated.

We noticed recently that in comparison to all other stocks we analyze in the news; ODP has received less coverage from the financial media in business television and blogs. While bearish sentiment on a stock is not always a bad thing, it is something you need to be aware of. The Motley Fool survey of crowd sentiment shows that many investors believe this stock will underperform. Office Depot, Incorporated receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals.

“… Joshi has tracked over, not only strong supports-- and that's up 6%. OFFICE DEPOT, and limited brands. This one in the news not only because of the reports of strong sales yester... …”

2:09P, Nov. 30,2009 ODP $6.13 Office Depot, Inc.
Fox Business

ODP News Mentioned on Fox Business Recently

The latest news from business television and influential blogs is always available through Ockham's RazorWire, and this news is in relation to Office Depot, Incorporated.

As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, ODP has been less covered in the news compared to the rest of our universe of stocks. The crowd at The Motley Fool does not like ODP and believes that it will Underperform. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on ODP.

“… OFFICE DEPOT number four, apple is number five. Next tier is office max at number six with $3 billion of online sales. Then comes sears followed by cdw, new egg and best buy. …”

10:39A, Nov. 30,2009 ODP $6.30 Office Depot, Inc.
Fox Business

ODP News Mentioned on Fox Business Recently

Staying informed on the news is invaluable for investors, and RazorWire has captured a recently discussion on ODP from Fox Business.

As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, ODP has been less covered in the news compared to the rest of our universe of stocks. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on ODP. The crowd at The Motley Fool does not like ODP and believes that it will Underperform.

“… Staples two, dell, computers number three, OFFICE DEPOT is number four and then the next, apple, officemax, and you guys are number seven on the on-line list, cbw after that and y... …”

View All Office Depot, Inc. Stock News

Key Fundamentals

ODP - Office Depot, Incorporated Fundamentals
Price (2/9 3:27PM) $5.68
Volume (2/9 3:27PM) 5.0 Million
Last Close Price $5.38
10 Day Average Volume 4.5 Million
13 Week Price Range $5.19 - $7.20
52 Week Price Range $0.59 - $7.84
LTM Revenue $12.3 Billion
 
Shares Outstanding (12/2008) 274.7 Million
Market Capitalization $1.5 Billion
Shares Held By Institutions 233.4 Million
Institutional Holders 338
% Shares Held By Institutions 85%
Earnings Per Share (EPS) ($5.42)
P/E Ratio n/a
Book Value Per Share $3.11
 
Gross Margin 28.90%
Annual Dividend 0.00
Dividend Yield 0.00%
Beta 3.40
Fiscal Year Ends December

About Office Depot, Inc.

Office Depot, Incorporated is considered to operate in the Services sector. They specifically operate in the Specialty Retail, Other business segment contained within the Specialty Retail industry.

The Company is a global supplier of office products and services under the Office Depot(r) brand and other proprietary brand names.