Zacks Research Lowers Xerox Q1 Earnings Estimate

Xerox Holdings Co. (NYSE:XRX - Free Report) has received a downgrade in earnings estimates for their first quarter of 2025. This reduction was reported by investment analysts at Zacks Research on Tuesday, February 18th. According to analyst R. Department at Zacks, Xerox is now expected to report earnings per share (EPS) of $0.08, marking a decrease from the previous estimate of $0.17.

Xerox's Earnings Outlook

The consensus outlook for Xerox for the full year currently stands at an EPS of $1.18. Zacks Research has also provided future estimates which include $1.10 EPS for FY2025, and estimates for subsequent quarters in 2026 as follows: $0.17 for Q2, $0.26 for Q3, and $0.48 for Q4, leading to an expected FY2026 EPS of $1.31.

Analyst Ratings and Target Price Changes

Additional scrutiny from other analysts has also been noted. For instance, Morgan Stanley adjusted its target price for Xerox shares from $10.00 down to $8.00, assigning an "underweight" rating. Similarly, JPMorgan Chase & Co. has also decreased its price target from $11.00 to $8.00 and maintained the underweight rating. Furthermore, StockNews.com has shifted its rating from "buy" to "hold" regarding Xerox. Currently, the stock has received three sell ratings and two hold ratings from equity research analysts, which reflects a generally cautious sentiment. MarketBeat.com reports that Xerox has an average rating of "Reduce" with a target price of $9.50.

Xerox Stock Performance

On the trading front, Xerox stock opened at $7.85 on Friday, reflecting a 2.2% decrease. The company's current financial metrics show a current ratio of 1.11, a quick ratio of 0.84, and a debt-to-equity ratio of 2.61. Over the past year, Xerox stock has seen a low of $7.77 and a high of $19.48. With a market capitalization of $976.30 million and a price-to-earnings ratio of 8.36, the stock presents certain investment considerations. The 50-day moving average is $8.70, while the 200-day moving average stands at $9.41.

Dividend Decisions

Xerox recently declared a quarterly dividend which is set to be paid on April 30th, with a dividend of $0.125 per share for those on the record as of March 31st. This equates to an annualized dividend of $0.50, yielding approximately 6.37%. However, the company's payout ratio currently sits at -9.31%, indicating that the firm could face challenges in sustaining such dividends.

Insights on Institutional Trading

Institutional investor activities surrounding Xerox have also been notable. In the fourth quarter, UBS AM increased its holdings in Xerox by 7.1%, resulting in ownership of 549,551 shares valued at about $4.63 million following the acquisition of an additional 36,420 shares. Meanwhile, Voloridge Investment Management LLC established a new position worth around $1.375 million during the same period, and Two Sigma Advisers LP increased its holdings by 8.7%. Institutional ownership of Xerox stock is currently at 85.36%, indicating a strong presence of hedge funds and investment companies.

Understanding Xerox's Business Model

Xerox Holdings Corporation operates as a workplace technology company, delivering a range of hardware, software, and services primarily for enterprises. The company functions under two segments, which are Print and Other, as well as FITTLE, striving to integrate technology solutions that address customer needs in various regions including the Americas, Europe, and Asia.

Conclusion

With recent adjustments in earnings forecasts and mixed ratings from analysts, Xerox is positioned in a challenging space in the tech sector. Investors should closely monitor further developments regarding earnings, stock performance, and market reactions in the coming quarters.

Xerox, Earnings, Analysts