The 10-second takeaway
For the quarter ended Dec. 29 (Q4), Office Depot missed estimates on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share dropped to zero. GAAP earnings per share shrank to a loss.
Margins contracted across the board.
Office Depot notched revenue of $2.62 billion. The 15 analysts polled by S&P Capital IQ expected to see net sales of $2.77 billion on the same basis. GAAP reported sales were 12% lower than the prior-year quarter's $2.97 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.00. The 18 earnings estimates compiled by S&P Capital IQ predicted $0.03 per share. Non-GAAP EPS shrank to zero from the prior-year quarter's $0.00. GAAP EPS were -$0.06 for Q4 compared to $0.04 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 29.9%, 40 basis points worse than the prior-year quarter. Operating margin was 0.5%, 70 basis points worse than the prior-year quarter. Net margin was -0.3%, 100 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.82 billion. On the bottom line, the average EPS estimate is $0.08.
Next year's average estimate for revenue is $10.73 billion. The average EPS estimate is $0.09.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 485 members out of 619 rating the stock outperform, and 134 members rating it underperform. Among 184 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 138 give Office Depot a green thumbs-up, and 46 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Office Depot is hold, with an average price target of $3.00.
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