Update (9:35 a.m.): Updated with Thursday market open information.
NEW YORK (TheStreet) -- Jefferies increased its target price on Office Depot (ODP - Get Report) to $5, increased its EPS estimates and set a "hold" rating. The firm noted synergy potential, though steep, will drive target changes.
The stock was falling 1.4% to $4.92 shortly after the market opened on Thursday.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Specialty Retail industry. The net income increased by 359.9% when compared to the same quarter one year prior, rising from -$61.92 million to $160.90 million.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.
- The gross profit margin for OFFICE DEPOT INC is currently lower than what is desirable, coming in at 26.01%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 6.14% trails that of the industry average.
- Net operating cash flow has significantly decreased to -$25.56 million or 111.83% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- You can view the full analysis from the report here: ODP Ratings Report