The 10-second takeaway
For the quarter ended March 30 (Q1), Office Depot met expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share contracted to zero. GAAP earnings per share dropped to a loss.
Margins dropped across the board.
Office Depot chalked up revenue of $2.72 billion. The 12 analysts polled by S&P Capital IQ looked for a top line of $2.75 billion on the same basis. GAAP reported sales were 5.4% lower than the prior-year quarter's $2.87 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 17 earnings estimates compiled by S&P Capital IQ predicted $0.05 per share. Non-GAAP EPS dropped to zero from the prior-year quarter's $0.00. GAAP EPS were -$0.06 for Q1 compared to $0.14 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 24.3%, 640 basis points worse than the prior-year quarter. Operating margin was 1.1%, 320 basis points worse than the prior-year quarter. Net margin was -0.2%, 190 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $2.45 billion. On the bottom line, the average EPS estimate is -$0.09.
Next year's average estimate for revenue is $10.46 billion. The average EPS estimate is $0.07.
The stock has a one-star rating (out of five) at Motley Fool CAPS, with 484 members out of 614 rating the stock outperform, and 130 members rating it underperform. Among 173 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 133 give Office Depot a green thumbs-up, and 40 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 $4.48.
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