Group 1: Suzano (SUZ) - Suzano is a producer of eucalyptus pulp and paper, holding a Zacks Rank 1 (Strong Buy) [1] - The Zacks Consensus Estimate for its current year earnings has increased by 7.8% over the last 60 days [1] - The company has a PEG ratio of 0.08 compared to the industry average of 0.32, and possesses a Growth Score of A [1] Group 2: Great Lakes Dredge & Dock (GLDD) - Great Lakes Dredge & Dock is the largest provider of dredging services in the US, also holding a Zacks Rank 1 [2] - The Zacks Consensus Estimate for its current year earnings has increased by 34.8% over the last 60 days [2] - The company has a PEG ratio of 0.96 compared to the industry average of 1.49, and possesses a Growth Score of A [2] Group 3: The ODP Corporation (ODP) - The ODP Corporation provides business services, products, and digital workplace technology solutions, also holding a Zacks Rank 1 [3] - The Zacks Consensus Estimate for its current year earnings has increased by 9% over the last 60 days [3] - The company has a PEG ratio of 0.44 compared to the industry average of 3.48, and possesses a Growth Score of B [3]

ODP Corp. (ODP) closed the last trading session at $17.18, gaining 27.9% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $31 indicates an 80.4% upside potential.The mean estimate comprises three short-term price targets with a standard deviation of $12.49. While the lowest estimate of $17 indicates a 1.1% decline from the current price level, the most optimistic analyst expects the ...

Financial Data and Key Metrics Changes - The company generated total revenue of $1.7 billion in Q1 2025, reflecting a 9% decline compared to the same quarter last year, but showing improvement in year-over-year trends compared to prior quarters [20] - Adjusted EBITDA was $76 million, down from $91 million in the previous year, while adjusted free cash flow increased significantly to $45 million from $17 million [23][25] - GAAP operating loss was $32 million compared to a GAAP operating income of $41 million in the prior year [22] Business Line Data and Key Metrics Changes - The consumer division, Office Depot, reported sales of $838 million, down 11% year-over-year, but showed improved trends with a 500 basis point improvement in same-store sales [25][26] - ODP Business Solutions reported revenue of $852 million, down 8% year-over-year, but showed slight improvement compared to the previous quarter [28] - The supply chain business, VARE, achieved over 85% year-over-year revenue growth from third-party customers, with third-party revenue reaching $17 million, up 89% [12][33] Market Data and Key Metrics Changes - The company is expanding into the hospitality market, which is valued at $16 billion, and has established partnerships with major suppliers to support this initiative [14][15] - The onboarding of new business contracts has been slower than anticipated, but progress is being made, particularly in the hospitality sector [11][12] Company Strategy and Development Direction - The company is focused on its "Optimize for Growth" plan, which aims to reduce fixed costs, enhance B2B capabilities, and decrease reliance on retail [7][17] - The strategy includes leveraging core strengths to expand into higher growth segments such as hospitality and supply chain services [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improving trends within the consumer business and anticipates better performance in the B2B segment in the second half of the year [40][41] - The company is actively managing potential tariff impacts and has diversified its sourcing strategy to mitigate risks [37][68] Other Important Information - The company closed nine retail stores as part of its restructuring plan and is focused on optimizing cash flow and margin dollars [18][52] - The balance sheet remains solid, with total liquidity of $653 million and total debt of $262 million [35] Q&A Session Summary Question: Insights into retail momentum and sales strategies - Management highlighted four key strategies driving improved performance: enhanced customer engagement, a new merchandising strategy, daily performance management, and targeted sales promotions [45][46][48] Question: Future pace of store closures - The company will evaluate store closures based on cash flow optimization and margin generation, with a focus on maintaining strong performance [51][52] Question: Onboarding delays for new contracts - Delays are attributed to longer lead times in the hospitality sector and the complexity of onboarding large contracts like CoreTrust [55][56] Question: Categories strengthening in retail - Management noted success in non-tariff categories and a shift to a more value-oriented merchandising strategy [63][64] Question: Impact of tariffs on business - The company believes it has mitigated most tariff impacts through strategic sourcing and pricing adjustments [66][68] Question: Converting new business pipeline into revenue - New leadership and a rigorous management system are being implemented to enhance conversion rates for new business opportunities [89][90]

Financial Data and Key Metrics Changes - The company generated total revenue of $1.7 billion in Q1 2025, reflecting a 9% decline compared to the same quarter last year, but showing improvement in year-over-year trends compared to prior quarters [19] - Adjusted EBITDA was $76 million, down from $91 million in the previous year, while adjusted free cash flow increased significantly to $45 million, more than double the $17 million generated in the same period last year [21][23] - GAAP operating loss was $32 million, compared to a GAAP operating income of $41 million in the prior year, primarily due to restructuring expenses and asset impairments [20] Business Line Data and Key Metrics Changes - The consumer division, Office Depot, reported sales of $838 million, down 11% year-over-year, but showed a 500 basis point improvement in same-store sales compared to the previous year [23][24] - ODP Business Solutions reported revenue of $852 million, down 8% year-over-year, impacted by cautious business conditions and a large customer loss from the previous year [26] - The supply chain business, VARE, achieved over 85% year-over-year revenue growth from third-party customers, highlighting strong demand for its services [12][31] Market Data and Key Metrics Changes - The company is expanding into the hospitality market, which is valued at $16 billion, and has established partnerships with major suppliers to support this initiative [14][15] - The onboarding of new business contracts, including a significant contract with CoreTrust, is ongoing, with expectations for these to contribute more meaningfully in the second half of the year [11][27] Company Strategy and Development Direction - The company is focused on its "Optimize for Growth" plan, which aims to realign its organizational structure and reduce fixed costs while enhancing its B2B pivot and expanding into higher growth segments [7][16] - The strategy includes reducing reliance on retail and increasing operational flexibility, with a focus on capitalizing on core strengths in supply chain and distribution [7][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improving trends within the consumer business and anticipates better performance in the B2B segment as new customers are onboarded and the hospitality sector gains traction [36][39] - The company is actively monitoring the evolving tariff situation and has taken proactive measures to mitigate potential impacts, including diversifying sourcing strategies [35][66] Other Important Information - The company closed nine retail stores as part of its restructuring plan and eliminated areas of corporate support to reduce costs [17] - Total liquidity at the end of the quarter was $653 million, consisting of $185 million in cash and $468 million in available credit [33] Q&A Session Summary Question: Insights into retail momentum and sales strategies - Management highlighted four key strategies driving improved performance: enhanced customer engagement, a revised merchandising strategy, a daily management system, and targeted sales promotions [42][44][46] Question: Future pace of store closures - The company will evaluate store closures based on optimizing cash flow and margin dollars, with ongoing assessments of store performance [49][50] Question: Onboarding delays for new contracts - Delays are attributed to longer lead times in the hospitality sector and the complexity of onboarding large contracts like CoreTrust [52][54] Question: Categories strengthening in retail - Management noted success in non-tariff categories and a shift to a more value-oriented merchandising strategy, which has improved sales [61][62] Question: Impact of tariffs on business - The company believes it has mitigated most tariff impacts through strategic sourcing and pricing adjustments, with ongoing monitoring of the situation [64][66] Question: Converting new business pipeline into revenue - New leadership and a rigorous management system are being implemented to enhance the conversion of the business pipeline into revenue [88][90] Question: Update on stock buyback - Management reassured that they continually evaluate stock repurchase opportunities, reflecting confidence in the company's future [93]

Financial Data and Key Metrics Changes - The company generated total revenue of $1.7 billion in Q1 2025, reflecting a 9% decline compared to the same quarter last year, but showing improvement in year-over-year trends compared to prior quarters [19] - Adjusted EBITDA for the quarter was $76 million, down from $91 million in the previous year, while adjusted free cash flow increased significantly to $45 million from $17 million [22][24] - GAAP operating loss was $32 million compared to a GAAP operating income of $41 million in the prior year, with adjusted operating income at $54 million, down from $66 million [20] Business Line Data and Key Metrics Changes - The consumer division, Office Depot, reported sales of $838 million, down 11% year-over-year, but showed a 500 basis point improvement in same-store sales metrics [24][25] - ODP Business Solutions reported revenue of $852 million, down 8% year-over-year, impacted by cautious business conditions and a large customer loss from the previous year [27] - The supply chain business, VARE, achieved over 85% year-over-year revenue growth from third-party customers, with third-party revenue reaching $17 million, up 89% [12][32] Market Data and Key Metrics Changes - The company is expanding into the hospitality market, which is valued at $16 billion, and has established partnerships with major suppliers to support this initiative [13][14] - The onboarding of new business contracts, including a significant contract with CoreTrust, is ongoing, with expectations for these to contribute more meaningfully in the second half of the year [11][28] Company Strategy and Development Direction - The company is focused on a B2B pivot and expanding into higher growth segments such as hospitality and supply chain services, while reducing reliance on retail [7][16] - The "Optimize for Growth" restructuring plan aims to realign organizational structure and reduce fixed costs, with nine retail stores closed during the quarter [17][20] - The company is actively managing its balance sheet and liquidity, ending the quarter with total liquidity of $653 million [34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in improving trends within the consumer business and anticipates better performance in the B2B segment as new customers are onboarded [37][39] - The company is closely monitoring the evolving tariff situation and has taken proactive measures to mitigate potential impacts [36][41] - Management expects significant improvements in adjusted free cash flow generation compared to the previous year, with a focus on driving cash and margin [37][39] Other Important Information - The company has made significant progress in cash management, achieving a cash conversion improvement that contributed to the increase in adjusted free cash flow [13] - The company is evaluating the pace of store closures in light of improved retail performance and ongoing strategic initiatives [51] Q&A Session Summary Question: Insights into retail momentum and sales strategies - Management highlighted four key strategies driving improved performance, including enhanced customer engagement, a revised merchandising strategy, daily performance management, and targeted sales promotions [44][48] Question: Future pace of store closures - Management indicated that the "Optimize for Growth" plan will evaluate store performance to maximize cash flow and margin, with ongoing assessments of store closures [51][52] Question: Onboarding delays for new contracts - Management noted that onboarding delays are due to longer lead times in the hospitality sector and the complexity of large contracts like CoreTrust [55][56] Question: Categories showing strength in retail - Management reported success in non-tariff categories and a shift to a more value-oriented merchandising strategy, which has improved sales performance [63][64] Question: Impact of tariffs on business - Management believes they have mitigated most tariff impacts through diversified sourcing strategies and proactive pricing adjustments [66][68] Question: Converting new business pipeline into revenue - Management is focusing on bringing in qualified leadership, rigorous management systems, and frequent high-level meetings with new partners to drive conversion [90][91] Question: Update on stock buyback - Management stated that they continually evaluate stock repurchase opportunities and have confidence in the company's future [96]

Financial Performance - Consolidated YOY comparable revenue trends improved in Q1 2025[9] - Adjusted free cash flow significantly increased YOY, reaching $45 million in Q1 2025, compared to $17 million in the same period last year[9, 19] - Adjusted EBITDA was $76 million[18, 23] - Adjusted operating income was $54 million[18, 23] Business Segments - Office Depot's same store sales improved by 500 basis points YOY[9] - Veyer's revenue from third-party customers grew strongly, up 89% to $17 million in Q1 2025[9, 34] - ODP Business Solutions' adjacency categories accounted for 44% of the division's total revenue[28] Strategic Initiatives - The company is executing the "Optimize for Growth" plan, expecting a $380 million uplift in EBITDA and $1.3 billion in total value creation[12] - The company closed 9 retail store locations in Q1 2025, incurring $48 million in restructuring costs[12] - The company is expanding into the hospitality market, a $16 billion addressable market[10, 11] Financial Position - The company has a strong liquidity position, with $653 million in total available liquidity, including $185 million in cash and cash equivalents[38]

Group 1: Earnings Performance - ODP Corp. reported quarterly earnings of $1.06 per share, exceeding the Zacks Consensus Estimate of $0.65 per share, and showing a slight increase from $1.05 per share a year ago, resulting in an earnings surprise of 63.08% [1] - The company posted revenues of $1.7 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 3.03%, although this represents a decline from year-ago revenues of $1.87 billion [2] Group 2: Stock Performance and Outlook - ODP Corp. shares have declined approximately 40.1% since the beginning of the year, contrasting with the S&P 500's decline of 4.7% [3] - The company's earnings outlook is mixed, with the current consensus EPS estimate for the coming quarter at $0.26 on revenues of $1.58 billion, and $2.56 on revenues of $6.57 billion for the current fiscal year [7] Group 3: Industry Context - The Retail - Miscellaneous industry, to which ODP Corp. belongs, is currently ranked in the top 39% of over 250 Zacks industries, indicating a favorable position as the top 50% of Zacks-ranked industries tend to outperform the bottom 50% by more than 2 to 1 [8]

[Executive Summary & Financial Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Financial%20Highlights) This section provides an overview of The ODP Corporation's Q1 2025 financial performance, CEO commentary, and consolidated GAAP and adjusted results [First Quarter 2025 Overview](index=1&type=section&id=First%20Quarter%202025%20Overview) The ODP Corporation reported Q1 2025 revenue of $1.7 billion, a 9% decrease year-over-year, with a GAAP operating loss of $32 million and a net loss of $29 million. Adjusted EPS was $1.06, and adjusted free cash flow significantly increased to $45 million. The company also announced key supplier partnerships in the hospitality industry and new B2B customers Consolidated Financial Highlights (1Q25 vs 1Q24) | Consolidated (in millions, except per share amounts) | 1Q25 | 1Q24 | | :------------------------------------------ | :----- | :----- | | Sales | $1,699 | $1,869 | | Sales change from prior year period | (9)% | | | Operating income (loss) | $(32) | $41 | | Adjusted operating income | $54 | $66 | | Net income (loss) from continuing operations | $(29) | $31 | | Diluted earnings (loss) per share from continuing operations | $(0.97) | $0.83 | | Adjusted net income from continuing operations | $32 | $50 | | Adjusted earnings per share from continuing operations | $1.06 | $1.31 | | Adjusted EBITDA | $76 | $91 | | Operating Cash Flow from continuing operations | $57 | $44 | | Free Cash Flow | $36 | $13 | | Adjusted Free Cash Flow | $45 | $17 | - Total reported sales of **$1.7 billion**, down **9%** versus the prior year period, largely related to lower sales in its Office Depot Division (46 fewer retail locations, reduced traffic) and ODP Business Solutions Division[5](index=5&type=chunk) - GAAP operating loss of **$32 million** and net loss from continuing operations of **$29 million**, or **$(0.97)** per diluted share, versus GAAP operating income of **$41 million** and net income of **$31 million**, or **$0.83** per diluted share, in the prior year period[5](index=5&type=chunk) [CEO Commentary](index=3&type=section&id=CEO%20Commentary) CEO Gerry Smith highlighted positive momentum, sequential EBITDA improvement, and meaningful free cash flow growth. He noted significant new B2B contracts, progress in the hospitality industry, and strong third-party revenue growth for Veyer, expressing confidence in future sustained, profitable growth - Overall performance reflects positive momentum and improving trends, with EBITDA improving sequentially and free cash flow increasing meaningfully over last year[6](index=6&type=chunk) - Secured some of the most meaningful new B2B business contracts in company history, including an agreement with CoreTrust, with accelerating customer onboarding[6](index=6&type=chunk) - Making significant underlying progress on efforts to serve the hospitality industry, including forging key supplier relationships and engaging with potential new customers, expecting more meaningful results beginning in the second half of this year[6](index=6&type=chunk) - Veyer continued to deliver exceptional results, achieving over **85% revenue growth** from third-party customers and adding significant new accounts[6](index=6&type=chunk) [Consolidated GAAP Results](index=3&type=section&id=Consolidated%20GAAP%20Results) Q1 2025 total reported sales decreased 9% to $1.7 billion, driven by lower sales in both consumer (Office Depot) and B2B divisions. The company reported a GAAP operating loss of $32 million and a net loss of $29 million, primarily due to $86 million in charges, including $48 million for restructuring and $28 million in asset impairments - Total reported sales for the first quarter of 2025 were **$1.7 billion**, a decrease of **9%** compared with the same period last year, driven primarily by lower sales in both its consumer (Office Depot, 46 fewer stores, lower traffic) and business-to-business ("B2B") divisions[7](index=7&type=chunk) - The Company reported GAAP operating loss of **$32 million** in Q1 2025 (down from **$41 million** income in prior year), including **$86 million** of charges (**$48 million** in restructuring expenses for "Optimize for Growth" plan, **$28 million** in non-cash asset impairments of operating lease ROU assets)[8](index=8&type=chunk) - Net loss from continuing operations was **$29 million**, or **$(0.97)** per diluted share in Q1 2025, down compared to net income of **$31 million**, or **$0.83** per diluted share in Q1 2024[8](index=8&type=chunk) [Consolidated Adjusted (Non-GAAP) Results](index=3&type=section&id=Consolidated%20Adjusted%20(Non-GAAP)%20Results) Adjusted operating income was $54 million, down from $66 million YoY, and adjusted EBITDA was $76 million, down from $91 million. Adjusted net income from continuing operations was $32 million ($1.06 per diluted share), compared to $50 million ($1.31 per diluted share) in the prior year. Operating cash flow increased to $57 million, and adjusted free cash flow rose significantly to $45 million, with total available liquidity of $653 million Selected Adjusted (Non-GAAP) Financial Measures (1Q25 vs 1Q24) | Metric | 1Q25 | 1Q24 | | :------------------------------------------ | :----- | :----- | | Adjusted operating income | $54 million | $66 million | | Adjusted EBITDA | $76 million | $91 million | | Adjusted net income from continuing operations | $32 million | $50 million | | Adjusted diluted earnings per share from continuing operations | $1.06 | $1.31 | - Operating cash flow from continuing operations of **$57 million** and adjusted free cash flow of **$45 million**, versus **$44 million** and **$17 million**, respectively, in the prior year period[9](index=9&type=chunk) - **$653 million** of total available liquidity including **$185 million** in cash and cash equivalents at quarter end[9](index=9&type=chunk) - Adjusted results for Q1 2025 exclude charges and credits totaling **$86 million** and associated tax impacts[11](index=11&type=chunk) [Division Performance](index=5&type=section&id=Division%20Performance) This section details the first quarter 2025 performance of ODP Business Solutions, Office Depot, and Veyer divisions, highlighting sales, operating income, and key operational drivers [ODP Business Solutions Division](index=5&type=section&id=ODP%20Business%20Solutions%20Division) The ODP Business Solutions Division reported sales of $852 million, an 8% decrease YoY, primarily due to macroeconomic conditions, lower demand, fewer customers, and severe weather. Adjacency categories constituted 44% of sales. The division secured new business, including CoreTrust, and made significant progress in establishing a presence in the hospitality industry through key supplier partnerships ODP Business Solutions Division Performance (1Q25 vs 1Q24) | Metric | 1Q25 | 1Q24 | | :------------------------ | :----- | :----- | | Sales (external) | $850 | $923 | | % change of total sales | (8)% | (8)% | | Division operating income | $21 | $31 | | % of total sales | 2% | 3% | - Sales were **$852 million** in Q1 2025, down **8%** YoY, related primarily to weaker macroeconomic conditions, lower demand, fewer customers, and severe weather impacts (estimated 80 basis points of decline)[14](index=14&type=chunk) - Total adjacency category sales (cleaning, breakroom, furniture, technology, copy/print) were **44%** of total ODP Business Solutions' sales[14](index=14&type=chunk) - Executed initiatives to convert a strong pipeline of new business, including initiating service for one of the largest contracts in Company history and winning key new business like the agreement with CoreTrust (a 3,500+ business member purchasing collective)[14](index=14&type=chunk) [Office Depot Division](index=5&type=section&id=Office%20Depot%20Division) The Office Depot Division reported sales of $838 million, an 11% decrease YoY, primarily due to 46 fewer retail locations and lower retail/online consumer traffic. However, targeted sales strategies led to an improvement over recent quarterly trends, with comparable store sales down 5% (an improvement from 10% in the prior year). Operating income was $45 million Office Depot Division Performance (1Q25 vs 1Q24) | Metric | 1Q25 | 1Q24 | | :--------------------------------- | :----- | :----- | | Sales (external) | $832 | $937 | | % change of total sales | (11)% | (14)% | | Division operating income | $45 | $50 | | % of total sales | 5% | 5% | | Change in comparable store sales | (5)% | (10)% | - Reported sales were **$838 million** in Q1 2025, down **11%** compared to the prior year, reflecting an improvement over recent prior quarterly trends as targeted profitable sales strategies gained traction[13](index=13&type=chunk) - The Company closed **12 retail stores** in the quarter and had **857 stores** at quarter end, with sales down **5%** on a comparable store basis, representing a meaningful improvement over the **10% decrease** in the prior year period[13](index=13&type=chunk) - Operating income was **$45 million** in Q1 2025, compared to **$50 million** during the same period last year, driven primarily by the flow through impact from lower sales[21](index=21&type=chunk) [Veyer Division](index=7&type=section&id=Veyer%20Division) Veyer, the supply chain division, generated $1.2 billion in reported sales, primarily supporting internal customers. Sales from third-party customers increased by 89% YoY to $17 million, with third-party EBITDA remaining flat at $3 million. The division continued to add new third-party accounts and executed warehousing and fulfillment services for a major e-commerce company Veyer Division Performance (

Company Performance - ODP Corp. closed at $13.55, with a daily increase of 1.35%, outperforming the S&P 500's gain of 0.58% [1] - The stock has decreased by 6.7% over the past month, underperforming the Retail-Wholesale sector's loss of 0.19% and the S&P 500's loss of 0.84% [1] Earnings Forecast - The upcoming earnings report is scheduled for May 7, 2025, with projected earnings per share (EPS) of $0.65, reflecting a 38.1% decrease from the same quarter last year [2] - The Zacks Consensus Estimate for revenue is $1.65 billion, down 11.86% from the previous year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are estimated at $2.56 per share and revenue at $6.57 billion, indicating declines of 22.42% and 5.99% respectively from the previous year [3] - Recent analyst estimate revisions suggest changing business trends, with positive revisions indicating a potentially better business outlook [3][4] Valuation Metrics - ODP Corp. has a Forward P/E ratio of 5.23, which is a discount compared to the industry average of 13.72 [6] - The company's PEG ratio is currently 0.37, while the average PEG ratio for Retail - Miscellaneous stocks is 1.5 [6] Industry Ranking - The Retail - Miscellaneous industry has a Zacks Industry Rank of 188, placing it in the bottom 25% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Company Performance - ODP Corp. stock closed at $12.43, with a +0.4% movement compared to the previous day, underperforming the S&P 500's daily gain of 1.67% [1] - The stock has dropped by 15.5% in the past month, compared to a loss of 4.21% in the Retail-Wholesale sector and a loss of 6.57% in the S&P 500 [1] Earnings Forecast - ODP Corp. is predicted to post an EPS of $0.65, indicating a 38.1% decline compared to the same quarter last year [2] - The revenue is estimated to be $1.65 billion, reflecting an 11.86% decrease compared to the same quarter of the previous year [2] - For the entire year, earnings are forecasted at $2.56 per share and revenue at $6.57 billion, indicating changes of -22.42% and -5.99% respectively compared to the previous year [3] Analyst Estimates and Rankings - Recent changes in analyst estimates for ODP Corp. are important as they reflect short-term business trends [4] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently ranks ODP Corp. as 5 (Strong Sell) [6] - Over the last 30 days, the Zacks Consensus EPS estimate for ODP Corp. has remained unchanged [6] Valuation Metrics - ODP Corp. has a Forward P/E ratio of 4.85, which is a discount compared to the industry's average Forward P/E of 13.35 [7] - The company has a PEG ratio of 0.35, while the average PEG ratio for Retail - Miscellaneous stocks is 1.4 [7] Industry Context - The Retail - Miscellaneous industry is part of the Retail-Wholesale sector and currently holds a Zacks Industry Rank of 159, placing it in the bottom 36% of all industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]