ODP (NASDAQ:ODP) Shares Gap Up Following Strong Earnings

Key Points

• ODP Corporation shares gapped up significantly after reporting quarterly earnings of $0.51 per share, exceeding analysts' expectations of $0.33.
• The company's revenue fell by 7.6% compared to the same quarter last year, and its stock recently traded at $17.37.
• Wall Street Zen downgraded ODP from a "buy" rating to a "hold" rating on June 22nd, reflecting a more cautious outlook on the stock.

Shares of The ODP Corporation (NASDAQ:ODP - Get Free Report) gapped up before the market opened on Wednesday following a better than expected earnings announcement. The stock had previously closed at $17.55, but opened at $19.01. ODP shares last traded at $17.37, with a volume of 113,636 shares traded.

The specialty retailer reported $0.51 EPS for the quarter, topping analysts' consensus estimates of $0.33 by $0.18. ODP had a return on equity of 11.22% and a net margin of 0.39%. The firm had revenue of $1.59 billion for the quarter, compared to the consensus estimate of $1.59 billion. During the same quarter in the prior year, the business earned $0.56 earnings per share. The company's revenue was down 7.6% compared to the same quarter last year.

Wall Street Analyst Weigh In

A number of equities analysts have issued reports on the company. UBS Group increased their price target on ODP from $17.00 to $19.00 and gave the stock a "neutral" rating in a research report on Thursday. Wall Street Zen cut ODP from a "buy" rating to a "hold" rating in a report on Sunday, June 22nd.

Institutional Investors Weigh In On ODP

Several hedge funds and other institutional investors have recently made changes to their positions in the stock. Creative Planning increased its holdings in shares of ODP by 30.4% in the second quarter. Creative Planning now owns 19,994 shares of the specialty retailer's stock valued at $362,000 after purchasing an additional 4,656 shares during the last quarter. SG Americas Securities LLC increased its stake in ODP by 14.2% during the second quarter. SG Americas Securities LLC now owns 23,318 shares of the specialty retailer's stock worth $423,000 after acquiring an additional 2,903 shares during the last quarter. Connor Clark & Lunn Investment Management Ltd. increased its stake in ODP by 132.9% during the second quarter. Connor Clark & Lunn Investment Management Ltd. now owns 114,818 shares of the specialty retailer's stock worth $2,082,000 after acquiring an additional 65,522 shares during the last quarter. Los Angeles Capital Management LLC acquired a new stake in ODP during the second quarter worth $333,000. Finally, Fox Run Management L.L.C. acquired a new stake in ODP during the second quarter worth $961,000. Institutional investors and hedge funds own 99.56% of the company's stock.

ODP Stock Performance

The firm has a 50 day simple moving average of $18.08 and a 200-day simple moving average of $16.96. The company has a debt-to-equity ratio of 0.30, a current ratio of 0.94 and a quick ratio of 0.45. The company has a market cap of $583.85 million, a price-to-earnings ratio of 29.41, a PEG ratio of 0.48 and a beta of 1.38.

About ODP

The ODP Corporation provides business services and supplies, products, and digital workplace technology solutions for small, medium, and enterprise businesses in the United States, Puerto Rico, and the U.S. Virgin Islands. The company operates through four divisions: ODP Business Solutions, Office Depot, Veyer, and Varis.