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PebbledsPicks (61.55)

October 2008



October 2008 Office Depot, Inc. (ODP)

October 01, 2008 – Comments (0) | RELATED TICKERS: ODP

Office Depot, Inc. supplies a range of office products and services in the United States and internationally. It offers an assortment of merchandise, such as general office supplies, computer supplies, business machines and related supplies, and office furniture through its chain of office supply stores under the Office Depot, Niceday, Foray, Ativa, Break Escapes, Worklife, and Christopher Lowell brand names. The company also provides graphic design, printing, reproduction, mailing, shipping, and other services through design, print, and ship centers. In addition, Office Depot, Inc. sells office products and services through direct mail catalogs, contract sales force, Internet sites, and retail stores, through a mix of company-owned operations, joint ventures, licensing and franchise agreements, alliances, and other arrangements. Further, it resells other manufacturer's branded items, such as ink, toner, paper, and technology products. As of February 26, 2008, the company served its customers through approximately 1,600 retail stores worldwide.

Comments: OK, I don't think there's much to say here.  Any good news about having reached a bottom in consumer sentiment, etc. is going to send this stock soaring.  This stock is simply too cheap.  It could be dead money for a year or so, but the margin of safety looks quite large in this stock. How much farther can it drop?  Well, a stock can always go to zero.  Not likely here.  I mean, come on, this stock is priced well below stated book, at a fraction of revenues, and for zero growth in perpetuity.  I think they may have just reported their first ever quarterly loss, but revenues are still increasing.  Whatever.  This market is not being rational.  From "Office Depot's recent second-quarter loss may be the least of investors' worries. What's potentially more troubling is that the Florida attorney general's office has opened an investigation of the office-supplies retailer for alleged overcharging of government clients, but somehow Office Depot hasn't disclosed this information to investors." Oh, so the crushed stock price has tons of fear built in, too?  All the better.  [more]

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