Not sure how many folks follow OMX, but to me this looks like low hanging fruit for a P/E firm.
First, the market cap is around $400 million.
Heck, this company has $485 million in cash, $270 million in total debt. However in the next 4 years, only about $45 million comes due. During that time 3/4ths of the existing store leases expire (so it's easy & cheap to close any underperforming stores). Moreover, they are not in Europe (so no headwind there).
They are a cash flow positive company. I mean they did make 25 cents in the 3rd quarter. If the job market does improve - that can only help (even in a very competitive space).
Management does not own a lot of shares, so it would be easy to accumulate a large position. Also - management has only been on the scene for a year. They may want to cash out sooner rather than later because they are not fully entrenched in the company.
The Lehman notes issue will be resolved shortly (but it's non-recourse to OMX, so it's not an issue). They will have some tax liability, but the company says it's largely offset by tax credits. They also have an underfunded pension, but the amount is very manageable (and they have at least 5 years to fund it via cash flow).
All in all - this could be taken out at $7 or $8, taken private, cleaned up in an improving economy & reissued to the public at a nice premium.
It also would be a good cheap merger with Staples (if the Government would allow the merger).
This stock simply baffles me. Market cap is now under $400 million. With all the dogs & cats of the market having made a move: MTG, RDN, HOV, BZH, SIRI, and on & on...this guy can't get a shake. Hard to believe.
The cash alone is worth $215 million net (after all debt). The company has been turning profits.
Amazing to think a P/E firm would not gobble this up or that ODP would make a bid for this guy. Why? because OMX + ODP would afford a lot of cost-cutting on the retail side while increasing & consolidating the contract side.