OMX Officemax Incorporated

Office Depot Inc. (ODP), known for offering its clients with the ground-breaking products to facilitate their business, recently announced the launch of Toshiba’s Thrive tablet at its retail store locations, commencing from July 10, 2011.

The leading supplier of office products and services across the globe announced that the buyers can now book the Thrive tablet prior to the launch through a pre-order beginning from June 14, 2011.

Touted as the world’s hottest tablet for office goers, Toshiba’s Thrive helps in easy execution of various diverse tasks simultaneously with customization potential of Android 3.1(Honeycomb). Further, it offers a user-friendly interface with five customizable home screens coupled with well-liked Google Mobile Service applications.

Further, the 10.1-inch Thrive offers an ultimate enterprise support coupled with a superior web browsing experience apart from the basic features like running videos, games, movies, books and more. Moreover, Thrive is the only tablet to offer changeable back panels.

The move will better position the company to develop in an immensely competitive environment while facilitating it to provide a refined way for approaching its customers.

Office Depot repositions itself to remain afloat in a difficult consumer environment. The company is containing costs, closing underperforming stores, reducing exposure to higher dollar-value inventory items, shuttering non-critical distribution facilities and focusing on providing innovative products and services, which in turn, are expected to contribute to margin improvement.

However, due to high exposure to international markets, Office Depot remains prone to currency fluctuations. The weakening of foreign currencies against the U.S. dollar may require the company to either raise prices or contract profit margins in locations outside the U.S.An increase in price may have an adverse impact on the demand for the products.

Moreover, we remain cautious about the torpid job market. As the economy continues to lackluster, consumers and small businesses remain frugal about big-ticket spending on items such as business machines and other durable products. Therefore, we believe that the demand for office products is closely tied to the health of the economy.

Consequently, we maintain a long-term ‘Underperform’ rating on the stock. However, Office Depot, which competes with Staples Inc. (SPLS) and OfficeMax Inc. (OMX), holds a Zacks #3 Rank, which translates into a short-term ‘Hold’ recommendation

 
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