ODP (NASDAQ:ODP) Shares Down 15% on Disappointing Earnings

The ODP Co. (NASDAQ:ODP)’s stock price dropped 15% during mid-day trading on Wednesday following a weaker than expected earnings announcement. The stock traded as low as $43.00 and last traded at $44.11. Approximately 216,679 shares traded hands during mid-day trading, a decline of 28% from the average daily volume of 301,305 shares. The stock had previously closed at $51.90.

The specialty retailer reported $1.05 EPS for the quarter, missing analysts’ consensus estimates of $1.64 by ($0.59). ODP had a return on equity of 19.45% and a net margin of 1.77%. The firm had revenue of $1.87 billion for the quarter, compared to analyst estimates of $1.96 billion. During the same period in the previous year, the firm posted $1.78 earnings per share. The company’s revenue for the quarter was down 11.2% on a year-over-year basis.

ODP declared that its Board of Directors has approved a stock repurchase program on Wednesday, February 28th that permits the company to repurchase $1.00 billion in shares. This repurchase authorization permits the specialty retailer to buy up to 48.7% of its stock through open market purchases. Stock repurchase programs are often an indication that the company’s management believes its shares are undervalued.

Analyst Ratings Changes

A number of research firms recently weighed in on ODP. StockNews.com raised shares of ODP from a “hold” rating to a “buy” rating in a report on Tuesday, March 12th. TheStreet lowered shares of ODP from a “b-” rating to a “c+” rating in a research note on Wednesday, February 28th. One research analyst has rated the stock with a hold rating and three have assigned a buy rating to the company. According to MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $62.00.

Insiders Place Their Bets

In other ODP news, CFO Diego Anthony Scaglione sold 25,000 shares of the stock in a transaction on Friday, March 1st. The shares were sold at an average price of $55.00, for a total transaction of $1,375,000.00. Following the transaction, the chief financial officer now directly owns 96,104 shares of the company’s stock, valued at $5,285,720. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Insiders own 3.60% of the company’s stock.

Institutional Investors Weigh In On ODP

Hedge funds have recently bought and sold shares of the company. Zurcher Kantonalbank Zurich Cantonalbank grew its stake in shares of ODP by 6.1% in the third quarter. Zurcher Kantonalbank Zurich Cantonalbank now owns 7,059 shares of the specialty retailer’s stock worth $326,000 after acquiring an additional 404 shares during the last quarter. TD Asset Management Inc raised its position in shares of ODP by 102.6% during the third quarter. TD Asset Management Inc now owns 23,500 shares of the specialty retailer’s stock valued at $1,085,000 after buying an additional 11,900 shares during the last quarter. Panagora Asset Management Inc. bought a new stake in shares of ODP in the third quarter valued at about $1,020,000. Teacher Retirement System of Texas grew its position in ODP by 93.0% during the third quarter. Teacher Retirement System of Texas now owns 50,475 shares of the specialty retailer’s stock worth $2,329,000 after buying an additional 24,318 shares in the last quarter. Finally, Illinois Municipal Retirement Fund bought a new position in ODP during the third quarter valued at about $931,000. 99.56% of the stock is currently owned by institutional investors.

ODP Price Performance

The stock has a 50-day simple moving average of $51.35 and a 200 day simple moving average of $50.69. The company has a debt-to-equity ratio of 0.15, a quick ratio of 0.54 and a current ratio of 0.99. The company has a market cap of $1.58 billion, a P/E ratio of 12.79, a P/E/G ratio of 0.65 and a beta of 1.68.

ODP Company Profile

The ODP Corporation provides business services and supplies, products, and digital workplace technology solutions for small, medium, and enterprise businesses in the United States, Puerto Rico, and the U.S. Virgin Islands. The company operates through four divisions: ODP Business Solutions, Office Depot, Veyer, and Varis.