The ShinesRooms.com Provides Stock Research on Office Depot Inc. and Staples Inc.
New York City, New York -- Retail specialty stores are facing tumultuous times. Apart from dealing with stagnating demand, the sector is also contending with the growing threat of online retailers. In order to fight the competition, the companies are employing various strategies such as store reformatting and M&A as is evidenced by the rumors of Office Depot Inc. acquiring OfficeMax Inc. At the very same time, Staples Inc. is holding itself well against its brick and mortar competitors as well as online contenders.
Access our free reports on Office Depot Inc. (ODP) and Staples Inc. (SPLS). Traders can also connect to our Wall Street Trading Floor where our research desk and market pros are standing between 8:50 am to 4:15 pm ET at
Office Depot Inc. is going through tough times. However, the company is taking a multi pronged approach to keep itself afloat. After dismal performance, its stock lately picked up on the back of its strong quarterly results. The other catalyst relates to the rumored acquisition of OfficeMax by the company. Office Depot is also going ahead with the plans of revamping its store format, making it more customer-friendly by integrating services like coffee and fast food. Our free research report on Office Depot can be downloaded upon registration at
Office Depot is also getting out of non-core business by selling its assets. Late last year, the company sold its Hungary business to Central Fund Venture Capital Fund. The move will help the company in controlling its costs and free up the resources to be infused into more critical areas. The company is still on with its international expansion, but it would put more focus on emerging economies like India and China. The company’s new strategy of growing through smaller format stores is also expected to help it in curtailing costs and increasing efficiency. Office Depot may shutter down 10 to 20 stores this year to cut costs.
Office Depot stock is currently trading at forward PE ratio of over 40, making it a rather expensive stock. However, any pullback in its price can provide good entry point for potential investors.
Elsewhere in the industry, Staples Inc. is one of the most established names in the specialty retail sector. The company has solid presence in both online and offline retail segments. Its dual presence let it enjoy synergies. The company stock lost 10 percent of its value in the past 12 months, but the stock price is now picking up. Staples also offers over 3 percent dividend yield. Apart from this, the company also buys back its shares, providing extra value to the investors. Staples had been increasing its dividend from past years and it is an attractive pick for income investors. Staples free research is available today at
Despite its solid offline presence, the company is also performing well online and generates nearly half of its total revenue from its online business. Staples also offer in-house brand of products, which helps it to boost its margins. Like other retailers, Staples is also looking to restructure its business to curtail costs. It recently redesigned its debt to control interest expenses. The company already has better-than-average debt/equity ratio.
It would also be reducing its store count to cut down the costs further. At the very same time, it will be augmenting its online presence. Staples Inc. is one the largest office supply store chain in the world and its scale provides it more leverage.
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Michael Thomas Smith