Office Depot's Stock Gains As Profit Beat Offsets Sales Miss

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Shares of Office Depot Inc. rose 1.8% in premarket trade Tuesday, as the office supply retailer beat fourth-quater profit expectations, but came up a bit short on sales. For the quarter ended Dec. 27, losses narrowed to $84 million, or 15 cents a share, from $144 million, or 34 cents a share, in the year-earlier period. Excluding non-recurring items, such as merger-related expenses, per-share earnings were 7 cents, above the FactSet consensus analyst estimate of 4 cents. Revenue rose to $3.83 billion from $3.49 billion, with North American sales rising to $1.54 billion from $1.4 billion, compared with FactSet estimates of $3.91 billion and $1.55 billion, respectively. Domestic same-store sales fell 2%. For 2015, the company expects sales to decline primarily because of store closures, the negative effects of currency movements and continued challenging market conditions. The stock has run up 40% over the past three months through Monday, compared with a 2% gain in the S&P 500. Earlier this month, Office Depot agreed to be acquired by fellow office retailer Staples .

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