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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Mr. Big who wrote (12373)	2/18/1999 11:00:00 AM
From: Nazbuster	Respond to of 122087

<<OFF TOPIC - for Longs..>> Office Depot (ODP) From Briefing.com: OFFICE DEPOT (ODP) 30 7/8. An overlooked stock continues to post solid numbers. After the close Wednesday, office products retailer Office Depot (ODP) reported fourth quarter profits of $0.34 a share. That was a penny ahead of the average Wall Street estimate, and up 31% on a per share basis from the year ago $0.26 per share profit. Revenues rose 10%. ODP has posted steady growth over the past couple of years across most business lines, and they have not "missed" an earnings estimate for a long time. They added 100 new stores in 1998 compared to 41 in 1997, and plan on adding 105 in 1999. International business accounted for 11.7% of revenue in 1998 and is increasing. In almost every respect, this company is what Briefing.com respectfully calls a "plugger." It just keeps plugging along posting solid numbers. Although it is stretching it a bit, ODP also claims in the press release that "The Internet has been a big win for us." Internet driven sales rose to $29.4 million in the fourth quarter. Nothing wrong with that, but that is only 1.3% of the total $2.30 billion in revenue for the quarter. A large portion of that is probably sales they would have generated anyway. Of course, it is good to see ODP taking advantage of the efficiencies of the Internet, but this hardly rates as an Internet play. That is OK, because ODP's numbers stand on their own. At the current price, ODP trades at 25 times 1998 operating earnings. That is very reasonable for a company posting 30% earnings per share growth and steady revenue growth. The stock has been an underperformer the past year, rising from just 26 a year ago, but has recently risen from a 12-month low of 15 7/8 in October. It has come off a high of 39 in January. In a volatile market, "plugger" companies that can be counted on to deliver steady revenue and profit gains are worth a look. ODP qualifies on that basis, especially as it represents decent value.