ODP Corp. (ODP) closed at $19.50 in the latest trading session, marking a -0.91% move from the prior day. This move was narrower than the S&P 500’s daily loss of 1.21%. At the same time, the Dow lost 0.59%, and the tech-heavy Nasdaq lost 2.45%.
Coming into today, shares of the office supply retailer had lost 2.62% in the past month. In that same time, the Retail-Wholesale sector gained 2.79%, while the S&P 500 lost 0.71%.
ODP will be looking to display strength as it nears its next earnings release, which is expected to be November 5, 2020. In that report, analysts expect ODP to post earnings of $1.31 per share. This would mark a year-over-year decline of 12.67%. Our most recent consensus estimate is calling for quarterly revenue of $2.47 billion, down 11.26% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.47 per share and revenue of $9.61 billion. These totals would mark changes of -15.37% and -9.76%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for ODP. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ODP is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that ODP has a Forward P/E ratio of 5.67 right now. For comparison, its industry has an average Forward P/E of 12.47, which means ODP is trading at a discount to the group.
Investors should also note that ODP has a PEG ratio of 0.83 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. ODP’s industry had an average PEG ratio of 2.17 as of yesterday’s close.
The Retail – Miscellaneous industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 103, putting it in the top 41% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ODP in the coming trading sessions, be sure to utilize Zacks.com.
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Office Depot, Inc. (ODP): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
