Stock of the Day
|
OfficeMax (OMX)
OfficeMax Shares Up Despite Plummet in Profit
OfficeMax, one of the leaders in office products sales and distribution, reported a drop in fourth quarter earnings of almost 90 percent due to poor holiday sales. However, some movement in the executive makeup of the company has saved the stock price from tumbling. John Jennings was hired as the new VP and treasurer, and Randy Burdick will be the new CIO. Shares up OfficeMax were up slightly in early morning trading on Monday.
|
| Daily Chart |
If you are not able to see the chart, your email client probably does not support javascript. To view it, please click here
|
| Stock Analysis |
The nation's third largest office product retailer saw a 90 percent drop in earnings in the fourth quarter of 2004. OfficeMax earned $700,000 in the period, which translated into a per share loss after financial considerations. Earnings in this same period last year were almost $7 million, or 5 cents a share. The earnings numbers for the period this year were actually inflated, because without taking into account the sale of paper and forest assets, the total net loss would have exceeded $24 million. OfficeMax blames the losses on several factors, including a recent decline in sales, an accounting scandal, and the loss of several key executives of the company.
|
It would seem that OfficeMax was taking a turn for the worse, yet its stock is up almost 10 percent on the year. Even with the poor earnings news, shares of the company gained in trading on Monday. It seems it was a good time to announce the hiring and placement of two new key executives, John Jennings and Randy Burdick. Jennings, the new VP and treasurer, held a vice president position at Caremark RX since 2003 and was previously a treasurer for CVS. Burdick, the new CIO, most recently held the title of group information officer and vice president for Hewlett-Packard's Compaq division.
|
So while the most recent earnings report seemed disastrous, the executive shakeup actually spun the company into a positive light. OfficeMax believes that it has filled its open positions with players that can turn the company around. George Harad, the current CEO and executive chairman, said of Burdick, "Randy's experience and expertise will be of great value to OfficeMax as we pursue the integration of our contract and retail businesses. His leadership of our information technology function will drive further innovation in our businesses and the programs and services we deliver to our customers.” While we don't know if OfficeMax can definitely turn its earnings situation around, we can be sure that with the new executives in place this is definitely a stock to watch in the coming months.
|
Profile |
OfficeMax is a leader in both business-to-business and retail office products distribution. OfficeMax delivers an unparalleled customer experience -- in service, in product, in time savings, and in value -- through a relentless focus on its customers. The company provides office supplies and paper, print and document services, technology products and solutions, and furniture to large, medium and small businesses and consumers. OfficeMax customers are served by more than 40,000 associates through direct sales, catalogs, Internet and nearly 950 superstores.
|
|
|
|
|
