Barclays Maintains an 'Underweight' on OfficeMax (OMX); 2Q Likely Hampered by GM Declines
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Price: $15.26 --0%
Rating Summary:
3 Buy, 7 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
3 Buy, 7 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays maintains an 'Underweight' on OfficeMax (NYSE: OMX) price target of $7.00.
Barclays analyst says, "Our 2Q EPS estimate of $0.00 represents a decrease from $0.12 last year: We believe that OMX continues to face challenges in both its retail and contract businesses. Our below-consensus 2Q EPS estimate of $0.00 is predicated on a total revenue decline of 2.2%. Importantly, we expect gross margins to decline by approximately 120 bps as OMX anniversaries a $14.6 million shrink benefit experienced in 2Q 2010. In our view, the retail segment is likely to be constrained by the challenging macro environment - we estimate 2Q same-store sales of (2.0)% versus (0.3)% last year. We expect the contract segment to experience a 5.0% revenue decline in 2Q even as OMX attempts to correct pricing and diversify its customer base by adding more small and medium-sized businesses to its portfolio. OfficeMax is the smallest of the three major office products players and, therefore, is likely to face challenges in improving its contract business."
2Q EPS to be reported on August 2: OfficeMax is scheduled to report 2Q 2011 results on Tuesday, August 2, 2011, before the market open. A conference call will follow at 10:00 AM (EDT).
For more ratings news on OfficeMax click here and for the rating history of OfficeMax click here.
Shares of OfficeMax closed at $7.02 yesterday.
Barclays analyst says, "Our 2Q EPS estimate of $0.00 represents a decrease from $0.12 last year: We believe that OMX continues to face challenges in both its retail and contract businesses. Our below-consensus 2Q EPS estimate of $0.00 is predicated on a total revenue decline of 2.2%. Importantly, we expect gross margins to decline by approximately 120 bps as OMX anniversaries a $14.6 million shrink benefit experienced in 2Q 2010. In our view, the retail segment is likely to be constrained by the challenging macro environment - we estimate 2Q same-store sales of (2.0)% versus (0.3)% last year. We expect the contract segment to experience a 5.0% revenue decline in 2Q even as OMX attempts to correct pricing and diversify its customer base by adding more small and medium-sized businesses to its portfolio. OfficeMax is the smallest of the three major office products players and, therefore, is likely to face challenges in improving its contract business."
2Q EPS to be reported on August 2: OfficeMax is scheduled to report 2Q 2011 results on Tuesday, August 2, 2011, before the market open. A conference call will follow at 10:00 AM (EDT).
For more ratings news on OfficeMax click here and for the rating history of OfficeMax click here.
Shares of OfficeMax closed at $7.02 yesterday.
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