Both Office Depot (ODP) and OfficeMax (OMX) reported earnings this morning, and it looks like both stocks are still in difficult times.
OfficeMax reported earnings of eight cents a share (after adjustments) which is a big tumble from the 36 cents a share it earned a year ago. Even worse for the company is that today’s earnings came in six cents below Wall Street’s estimate. As a result, the shares are getting a haircut this morning of about 5%.
The company added that it’s not very optimistic for the current quarter. OMX is expecting lower sales than a year ago and it plans to post a quarterly loss. I currently have the stock rated as a “buy,” although I may downgrade it soon due to the sluggish outlook.
Office Depot is also rated as a “buy,” but its earnings report is even rockier. The company reported another loss, and one that was wider than a year ago. The shortfall this time was for eight cents a share, and revenue declined by 17%. Business is clearly very weak for them. One piece of good news is that ODP beat Wall Street’s consensus of -10 cents a share, but a loss is still a loss.
I’ll probably update my ratings for the office suppliers once we have all the details next week.