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The ODP Corporation (ODP) to Post Q4 Earnings: What's in Store?

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The ODP Corporation (ODP - Free Report) is likely to register a decline in the top line when it reports fourth-quarter 2020 numbers on Feb 24, before the market opens. The Zacks Consensus Estimate for revenues is pegged at $2,342 million, indicating a decline of 6.6% from the prior-year reported figure.

The Zacks Consensus Estimate for fourth-quarter earnings has went down by 30.2% to $1.11 over the past seven days. The figure suggests a decline of 7.5% from earnings of $1.20 reported in the year-ago quarter.

This provider of business services and supplies, products, and technology solutions has a trailing four-quarter earnings surprise of 3.1%, on average. In the last reported quarter, the company’s bottom line beat the Zacks Consensus Estimate by a significant margin.

Key Factors to Note

The impact of coronavirus on The ODP Corporation's fourth-quarter performance cannot be ruled out. The company has been struggling with soft sales across its Business Solutions Division (BSD), Retail Division and CompuCom Division due to the ongoing crisis. On its last earnings call, the company highlighted that the pandemic has caused significant business disruption for its B2B customers. Although the recovery is underway, business has not been the usual one.

Nonetheless, The ODP Corporation’s low-cost model, multiple routes to market, expanded product portfolio, and flexible supply chain and distribution capabilities bode well. Markedly, the company’s Business Acceleration Program has helped it in attaining cost-effective structure and improving operational efficiencies. Moreover, as part of the “Maximize B2B” restructuring plan, the company has been focusing on accelerating growth on its B2B platform, lowering dependency on retail consumer operations and maximizing cost savings.

The company’s value proposition and broad product assortment continue to resonate well with customers. This is quite evident from rise in demand in “work-from-anywhere” category, including home office, technology and workspaces. The company’s “Be Well At Work” categories, which include Cleaning & Breakroom, PPE and sanitation have been registering sturdy demand. Additionally, the company has been making every effort to enhance e-commerce platforms. The company has implemented curbside pick-up option in all locations.

The ODP Corporation Price, Consensus and EPS Surprise

The ODP Corporation Price, Consensus and EPS Surprise

The ODP Corporation price-consensus-eps-surprise-chart | The ODP Corporation Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict a beat for The ODP Corporation this earnings season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The ODP Corporation has a Zacks Rank #5 (Strong Sell) and an Earnings ESP of 0.00%.

3 Stocks With a Favorable Combination

Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:

Target (TGT - Free Report) has an Earnings ESP of +9.79% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Home Depot (HD - Free Report) has an Earnings ESP of +3.28% and a Zacks Rank #3.

Costco (COST - Free Report) has an Earnings ESP of +2.43% and a Zacks Rank #3.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

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