Can Mergers Help Office Depot Inc (ODP) Max Out?

Amazon’s revenues have increased 1,150% in the past decade compared to OfficeMax and Office Depot’s declines of 4% and 2.8% respectively. Amazon boasts a market cap of $120.5 billion and has experienced a stock that has grown over 45% in the past year. The chart below allows us to zoom out and see how these companies have performed in the past five years.

SPLS data by YCharts

The Foolish Bottom Line…

I think it becomes obvious why OfficeMax and Office Depot are looking to potentially merge. Revenues have decreased, stocks have plummeted, and the competition has become more than either rightfully want to face. It will be interesting to see how or if the details get ironed out with these companies. The Federal Trade Commission might reconsider their stance on competition simply because if there aren’t mergers, there will likely be fewer competition due to fewer companies in the next several years.

The article Can Mergers Help Office Depot Max Out? originally appeared on Fool.com and is written by Tyler Wofford.

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