KeyBanc Remains Optimistic on Staples' (SPLS) Merger With Office Depot (ODP)

KeyBanc maintained an Overweight rating on Staples, Inc. (NASDAQ: SPLS) with a price target of $20. Earlier the New York Post reported that the FTC could challenge its merger with Office Depot (NASDAQ: ODP). In the view of analyst Bradley B. Thomas, if the deal is challenged, Staples may find a way to appease FTC concerns through asset divestiture.

"If accurate, the article is obviously troubling as we had believed the deal had greater than 50% chance of being approved. Nonetheless, we remain optimistic that, if challenged, SPLS will find a way to placate FTC concerns through asset divestiture (though the article suggests even this could be difficult)," said Thomas.

"While we continue to believe there is significant upside if the deal gets approved, this morning’s developments are a negative and will likely weigh on sentiment," added the analyst.

For an analyst ratings summary and ratings history on Staples, Inc. click here. For more ratings news on Staples, Inc. click here.

Shares of Staples, Inc. closed at $13.54 yesterday.

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