OfficeMax (OMX) Has a Misunderstood Balance Sheet and Compelling Valuation
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Price: $15.26 --0%
Rating Summary:
3 Buy, 7 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 5 | Down: 11 | New: 27
Rating Summary:
3 Buy, 7 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 5 | Down: 11 | New: 27
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Today analysts at KeyBanc reiterated a Buy rating on OfficeMax (NYSE: OMX) and raised their price target of $10.00 (from $7.00).
Analyst Bradley B. Thomas said “We continue to view OfficeMax as the most compelling value / special situation stock in our coverage universe, with several meaningful future positive catalysts still on the horizon.”
This morning, the Company announced that the extinguishment of its Lehman-related non-recourse Timber Notes has been accepted by the U.S. Bankruptcy Court and is now effective.
“This will remove more than $700 million in non-recourse debt from the balance sheet in the coming months (at a cash cost of just $15 million, improving book value by an estimated $400 million),” noted Thomas. “This is the first of several balance sheet improvement opportunities for OMX, which we view as substantial.”
“While fundamentals for the office products sector remain among the more challenged within our coverage, we believe OMX remains a compelling small cap special situation / value stock with a misunderstood balance sheet, an opportunity for fundamental improvement under new management, a call option should management pursue industry consolidation, as well as a stealth housing recovery investment,” added Bradley.
For an analyst ratings summary and ratings history on OfficeMax click here. For more ratings news on OfficeMax click here.
Shares of OfficeMax closed at $7.11 yesterday.
Analyst Bradley B. Thomas said “We continue to view OfficeMax as the most compelling value / special situation stock in our coverage universe, with several meaningful future positive catalysts still on the horizon.”
This morning, the Company announced that the extinguishment of its Lehman-related non-recourse Timber Notes has been accepted by the U.S. Bankruptcy Court and is now effective.
“This will remove more than $700 million in non-recourse debt from the balance sheet in the coming months (at a cash cost of just $15 million, improving book value by an estimated $400 million),” noted Thomas. “This is the first of several balance sheet improvement opportunities for OMX, which we view as substantial.”
“While fundamentals for the office products sector remain among the more challenged within our coverage, we believe OMX remains a compelling small cap special situation / value stock with a misunderstood balance sheet, an opportunity for fundamental improvement under new management, a call option should management pursue industry consolidation, as well as a stealth housing recovery investment,” added Bradley.
For an analyst ratings summary and ratings history on OfficeMax click here. For more ratings news on OfficeMax click here.
Shares of OfficeMax closed at $7.11 yesterday.
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