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Staples Reports Fiscal 3Q15 Results: Revenue and Income Falls


Nov. 20 2020, Updated 4:06 p.m. ET

Staples’ price movement

Staples (SPLS) has a market cap of $7.8 billion, and its YTD (year-to-date) price movement has been falling since June 2015. After the 3Q15 earnings report, Staples fell by 2.7% to close at $12.11 per share on November 18, 2015. The price movement on a weekly, monthly, and YTD basis is -6.2%, -3.0%, and -31.6%, respectively.

Technically, the stock has broken the support and is trading below all moving day averages. It is trading 6.0% below its 20-day moving average, 5.3% below its 50-day moving average, and 18.3% below its 200-day moving average.

The ALPS Sector Dividend Dogs ETF (SDOG) invests 1.8% of its holdings in Staples. The ETF tracks an equal-weighted index of the five highest-yielding S&P 500 securities in each sector. The YTD price movement of SDOG is -3.6% as of November 17, 2015.

Staples’ (SPLS) competitors and their market cap are as follows:

  • FedEx (FDX) — $46.0 billion
  • Best Buy (BBY) — $10.8 billion
  • Office Depot (ODP) — $3.9 billion
  • Essendant (ESND) — $1.3 billion
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Staples’ performance in 3Q15

The company reported 3Q15 net sales of $5.6 billion, a fall of 6.2% from its net sales of $5.9 billion in 3Q14. Sales of its North American Stores & Online and International Operations segments fell by 7.8% and 16.8%, respectively, and its North American Commercial segment’s sales rose by 0.69% from the prior year period. The cost of goods sold as a percentage of sales fell by 1.4% and the gross profit margin rose by 3.8% in 3Q15 from the prior year period. Its net income and EPS (earnings per share) fell to $198.0 million and $0.31, respectively, in 3Q15, compared with the net income and EPS of $217.0 million and $0.34, respectively, in 3Q14. Comprehensive income rose to $188.0 million in 3Q15, compared with the comprehensive income of $80.0 million in 3Q14.

Meanwhile, cash and cash equivalents rose by 28.0% and merchandise inventories fell by 8.6% in 3Q15, on a quarterly basis. The company’s current ratio rose to 1.63 in 3Q15, compared with the current ratio of 1.57 in 2Q15. It’s declared a quarterly cash dividend of $0.12 per share on its common stock.

The company has projected figures for 4Q15 and fiscal 2015 as follows:

  • It expects sales of fiscal 4Q15 to fall in comparison to the sales of fiscal 4Q14.
  • Diluted non-GAAP (generally accepted accounting principles) EPS in the range of $0.26–$0.30 for 4Q15.
  • Free cash flow of more than $600 million for fiscal 2015.

The company’s guidance reflects the unfavorable impact of the stronger US dollar on sales and earnings. Its earnings guidance excludes any impact related to restructuring and other related activities or costs related to the planned acquisition of Office Depot.

About Staples

Staples offers products in various categories such as technology, facilities and breakroom, furniture, safety, and medical, as well as Copy & Print and Staples EasyTech services.


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