NYSE traded penny stock Office Depot (NYSE: ODP) announced prior to market open a major reinvestment into their company by commencing a cash tender offer to purchase up to $250 million of its outstanding 6.25% Senior Notes due 2013. ODP, a leading global provider of office supplies and services that helps customers save time, is an open target to be taken over by its biggest competitor, Staples, Inc. (NASDAQ: SPLS).
Shares in Boca Raton, Florida based ODP are up slightly in the first few minutes of today’s trading session.
Key Stats:
Average Volume (10-Day): 4,470,180
Shares Short (as of Jan 31, 2012): 27.09 Million
Float: 275.80 Million
YTD ODP Stock Chart:
Although ODP is up over 50% since mid-January, the company is struggling from a tough economy. ODP is set to report earnings on February 28, 2012. Analysts estimates are calling for $2.99 Billion in revenue. 2013 consensus estimates for ODP‘s EPS forecast are for $0.25. Assuming a multiple of 15x and a conservative 2013 EPS of $0.23, the rough intrinsic value of the stock is $3.45, a 10-14% upside from today’s price range..
ODP is surely a penny stock to watch as Staples could be gearing up to acquire the firm in order to increase scale.
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