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ODP (ODP)
NASDAQ:ODP
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ODP
(NASDAQ:ODP)
Rating:57Neutral
Price Target:
$18.50
▼(-0.43%Downside)
ODP (ODP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$546.90M
Dividend YieldN/A
Average Volume (3M)433.39K
Price to Earnings (P/E)28.3
Beta (1Y)0.89
Revenue Growth-10.19%
EPS Growth-140.90%
CountryUS
Employees19,000
SectorConsumer Cyclical
Sector Strength64
IndustrySpecialty Retail
Share Statistics
EPS (TTM)1.06
Shares Outstanding30,082,424
10 Day Avg. Volume402,604
30 Day Avg. Volume433,386
Financial Highlights & Ratios
PEG Ratio-6.64
Price to Book (P/B)1.70
Price to Sales (P/S)0.00
P/FCF Ratio15.84
Enterprise Value/Market Cap4.87
Enterprise Value/Revenue0.09
Enterprise Value/Gross Profit1.91
Enterprise Value/Ebitda3.21
Forecast
1Y Price Target
$35.00Price Target Upside88.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
ODP Business Overview & Revenue Model
Company DescriptionODP Corporation is a leading provider of business services and products, operating primarily in the retail, contract, and direct sales sectors. The company offers a wide range of office supplies, furniture, technology products, and copy and print services. Through its well-known brands, including Office Depot and OfficeMax, ODP serves a diverse clientele ranging from small businesses to large enterprises, as well as individual consumers.
How the Company Makes MoneyODP Corporation generates revenue through multiple streams, primarily through the sale of office supplies, furniture, and technology products in its retail stores and online platforms. A significant portion of revenue comes from its Business Solutions Division, which provides products and services directly to businesses, government entities, and educational institutions via contractual agreements. Additionally, ODP earns money through its CompuCom division, which offers IT services and solutions to businesses. Strategic partnerships and supply agreements with various companies also contribute to its earnings, allowing ODP to offer a comprehensive suite of products and competitive pricing.
ODP Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 36.32%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong cash flow generation, positive retail trends, and significant growth in the supply chain business. However, the company faced revenue declines, a GAAP operating loss, and challenges in the B2B segment, including slower onboarding of new contracts.Q1-2025 Updates
Positive Updates
Strong Free Cash Flow Generation
ODP Corporation generated $45 million in adjusted free cash flow, more than double compared to the same period last year.
Positive Retail Trends
Retail segment saw a 500 basis point improvement in same-store sales compared to last year, with further improvements in April and early May.
Supply Chain Business Growth
VEYER achieved over 85% year-over-year revenue growth from third-party customers.
Expansion into New Markets
ODP is expanding into the $16 billion hospitality market, establishing agreements with major suppliers and expecting significant contributions in the second half of the year.
Negative Updates
Overall Revenue Decline
Total revenue declined by 9% compared to the first quarter of last year, driven by fewer stores, reduced traffic, and lower sales in ODP business solutions.
GAAP Operating Loss
GAAP operating loss was $32 million, compared to GAAP operating income of $41 million in the prior year period.
Impact of Restructuring Charges
The quarter included $86 million of charges related to restructuring expenses and asset impairments.
B2B Segment Challenges
B2B revenue was down 8% year-over-year, with slower-than-anticipated onboarding of new contracts impacting results.
Company Guidance
During the ODP Corporation's First Quarter 2025 Earnings Conference Call, the company emphasized its strategic pivot towards B2B services and expansion into high-growth markets like hospitality. The CEO highlighted the company's strong start to the year with $76 million in adjusted EBITDA and a significant increase in adjusted free cash flow to $45 million. Despite a 9% decline in total revenue to $1.7 billion, largely due to fewer retail stores and lower sales in ODP business solutions, the company reported improved year-over-year performance trends. The consumer division, Office Depot, showed better top-line trends and higher margins, with comparable store trends improving by 300 basis points from the previous quarter and 500 basis points from the same period last year. The B2B segment is undergoing a gradual shift, with new contracts like CoreTrust expected to contribute more in the second half of the year. Additionally, VEYER, the company's supply chain business, achieved over 85% year-over-year revenue growth from third-party customers. The company's balance sheet remains robust, with $653 million in liquidity, and ongoing initiatives are expected to yield improved results in the latter half of 2025.ODP Financial Statement Overview
Summary
ODP faces a challenging financial landscape with revenue declines and profitability pressures. While cash flow management shows resilience with improved free cash flow, the high leverage and negative net income in TTM are concerning. The company needs to focus on boosting revenue and controlling costs to enhance financial health and shareholder value.Income Statement
ODP has experienced fluctuating financial performance. The TTM (Trailing-Twelve-Months) data shows a Gross Profit Margin of 20.48% and a negative Net Profit Margin of -0.69%, indicating profitability challenges. Revenue has been on a declining trend, with a noticeable drop from $9.71 billion in 2020 to $6.82 billion in TTM. Despite these challenges, the company maintains a positive EBITDA Margin of 2.77% in TTM, although it has reduced from previous years.60
Neutral
Balance Sheet
The balance sheet reflects moderate financial stability. The Debt-to-Equity Ratio is 1.27 in TTM, indicating a high leverage compared to equity. The Equity Ratio stands at 22.61%, showing a relatively low equity base compared to total assets. The Return on Equity (ROE) is negative in TTM due to net losses, which raises concerns about shareholder returns.55
Neutral
Cash Flow
ODP's cash flow analysis reveals some strengths and weaknesses. The Free Cash Flow has grown to $65 million in TTM, up from $32 million in 2024, highlighting improved cash generation. The Operating Cash Flow to Net Income Ratio is positive, suggesting strong cash conversion despite net losses. However, the Free Cash Flow to Net Income Ratio is less favorable due to negative earnings.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 6.82B | 6.99B | 7.83B | 8.49B | 8.46B | 9.71B |
| Gross Profit | 1.40B | 1.45B | 1.76B | 1.85B | 1.86B | 2.13B |
| EBITDA | 189.00M | 266.00M | 335.00M | 389.00M | 405.00M | 161.00M |
| Net Income | -47.00M | -3.00M | 139.00M | 166.00M | 187.00M | -319.00M |
Balance Sheet | ||||||
| Total Assets | 3.47B | 3.53B | 3.89B | 4.15B | 4.87B | 5.56B |
| Cash, Cash Equivalents and Short-Term Investments | 185.00M | 166.00M | 392.00M | 403.00M | 514.00M | 729.00M |
| Total Debt | 998.00M | 1.06B | 963.00M | 881.00M | 1.00B | 1.37B |
| Total Liabilities | 2.68B | 2.72B | 2.79B | 2.86B | 3.43B | 3.68B |
| Stockholders Equity | 784.00M | 807.00M | 1.10B | 1.29B | 1.44B | 1.88B |
Cash Flow | ||||||
| Free Cash Flow | 65.00M | 32.00M | 226.00M | 138.00M | 273.00M | 417.00M |
| Operating Cash Flow | 149.00M | 130.00M | 331.00M | 237.00M | 346.00M | 485.00M |
| Investing Cash Flow | -106.00M | -126.00M | -2.00M | -10.00M | -79.00M | 736.00M |
| Financing Cash Flow | -136.00M | -225.00M | -340.00M | -355.00M | -459.00M | -1.19B |
ODP Technical Analysis
Positive
18.58
Price Trends
17.75
Positive
16.11
Positive
20.59
Negative
Market Momentum
0.14
Positive
54.23
Neutral
84.78
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ODP, the sentiment is Positive. The current price of 18.58 is above the 20-day moving average (MA) of 18.45, above the 50-day MA of 17.75, and below the 200-day MA of 20.59, indicating a neutral trend. The MACD of 0.14 indicates Positive momentum. The RSI at 54.23 is Neutral, neither overbought nor oversold. The STOCH value of 84.78 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ODP.
ODP Risk Analysis
ODP disclosed 33 risk factors in its most recent earnings report. ODP reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ODP Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $783.95M | 31.49 | 14.01% | ― | 35.78% | 23.49% | |
62 Neutral | C$5.28B | 8.27 | 20.23% | 3.15% | 3.09% | 8.49% | |
57 Neutral | $546.90M | 28.33 | 4.96% | ― | -10.19% | -140.90% | |
52 Neutral | $53.31M | 104.99 | 1.44% | 17.28% | -0.62% | 1.15% | |
52 Neutral | $50.29M | ― | -54.32% | ― | -14.49% | -210.54% | |
50 Neutral | $314.66M | ― | -36.88% | ― | 1.38% | 63.65% | |
42 Neutral | $37.42M | ― | ― | -7.66% | -735.19% |
* Consumer Cyclical Sector Average
Performance Comparison
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18.58
-23.54
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NHTC
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ODP Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
ODP Appoints Co-Chief Financial Officers for Strategic Growth
Positive
Dec 12, 2024
The ODP Corporation has announced the appointment of Max Hood and Adam Haggard as Co-Chief Financial Officers. Max Hood will continue his role as the principal accounting officer, while Adam Haggard brings over 20 years of experience within the company to his new position. Both executives have entered into Letter Agreements outlining their compensation, including a base salary of $400,000, bonus eligibility, and participation in the company’s Long-Term Incentive Plan. These appointments may strengthen ODP’s financial strategy and operations, providing stability in leadership and potentially enhancing the company’s market position.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.