NYSE:XRX

Stock Analysis Report

Executive Summary

Xerox Holdings Corporation designs, develops, and sells document management systems and solutions worldwide.

Rewards

Trading at 39% below its fair value

Earnings are forecast to grow 6.77% per year

Earnings grew by 420.8% over the past year

Pays a high and reliable dividend of 3.16%

Risk Analysis

Has a high level of debt

Large one-off items impacting financial results



Snowflake Analysis

Undervalued established dividend payer.


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Samsung Electronics

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Share Price & News

How has Xerox's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: XRX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-8.4%

XRX

1.4%

US Tech

1.5%

US Market


1 Year Return

23.2%

XRX

81.9%

US Tech

20.1%

US Market

Return vs Industry: XRX underperformed the US Tech industry which returned 96.6% over the past year.

Return vs Market: XRX underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

XRXIndustryMarket
7 Day-8.4%1.4%1.5%
30 Day-11.2%1.5%1.4%
90 Day-4.0%19.9%8.7%
1 Year27.9%23.2%84.6%81.9%22.7%20.1%
3 Year35.6%-19.6%132.4%116.2%50.1%40.5%
5 Year8.5%-38.8%149.3%124.7%73.1%54.1%

Price Volatility Vs. Market

How volatile is Xerox's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Xerox undervalued compared to its fair value and its price relative to the market?

39.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: XRX ($31.64) is trading below our estimate of fair value ($51.83)

Significantly Below Fair Value: XRX is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: XRX is good value based on its PE Ratio (14.1x) compared to the Tech industry average (26.1x).

PE vs Market: XRX is good value based on its PE Ratio (14.1x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: XRX is poor value based on its PEG Ratio (2.1x)


Price to Book Ratio

PB vs Industry: XRX is good value based on its PB Ratio (1.4x) compared to the US Tech industry average (1.9x).


Next Steps

Future Growth

How is Xerox forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

6.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: XRX's forecast earnings growth (6.8% per year) is above the savings rate (2.7%).

Earnings vs Market: XRX's earnings (6.8% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: XRX's earnings are forecast to grow, but not significantly.

Revenue vs Market: XRX's revenue is expected to decline over the next 3 years (-4.3% per year).

High Growth Revenue: XRX's revenue is forecast to decline over the next 3 years (-4.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: XRX's Return on Equity is forecast to be low in 3 years time (18%).


Next Steps

Past Performance

How has Xerox performed over the past 5 years?

-28.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: XRX has a large one-off loss of $273.0M impacting its June 30 2019 financial results.

Growing Profit Margin: XRX's current net profit margins (5.6%) are higher than last year (1%).


Past Earnings Growth Analysis

Earnings Trend: XRX's earnings have declined by -28.1% per year over the past 5 years.

Accelerating Growth: XRX's earnings growth over the past year (420.8%) exceeds its 5-year average (-28.1% per year).

Earnings vs Industry: XRX earnings growth over the past year (420.8%) exceeded the Tech industry 25.2%.


Return on Equity

High ROE: XRX's Return on Equity (10.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Xerox's financial position?


Financial Position Analysis

Short Term Liabilities: XRX's short term assets ($4.2B) exceed its short term liabilities ($3.2B).

Long Term Liabilities: XRX's short term assets ($4.2B) do not cover its long term liabilities ($6.3B).


Debt to Equity History and Analysis

Debt Level: XRX's debt to equity ratio (92.7%) is considered high.

Reducing Debt: XRX's debt to equity ratio has increased from 60.5% to 92.7% over the past 5 years.

Debt Coverage: XRX's debt is well covered by operating cash flow (25.4%).

Interest Coverage: XRX's interest payments on its debt are well covered by EBIT (10.3x coverage).


Balance Sheet

Inventory Level: XRX has a low level of unsold assets or inventory.

Debt Coverage by Assets: XRX's debt is not covered by short term assets (assets are 0.9x debt).


Next Steps

Dividend

What is Xerox's current dividend yield, its reliability and sustainability?

3.16%

Current Dividend Yield


Dividend Yield vs Market

company3.2%marketbottom25%1.4%markettop25%3.7%industryaverage1.1%forecastin3Years3.2%

Current dividend yield vs market & industry

Notable Dividend: XRX's dividend (3.16%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: XRX's dividend (3.16%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: XRX's dividends per share have been stable in the past 10 years.

Growing Dividend: XRX's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (44.5%), XRX's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: XRX's dividends in 3 years are forecast to be well covered by earnings (23.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.3yrs

Average management tenure


CEO

John Visentin (57yo)

1.3yrs

Tenure

US$23,459,003

Compensation

Mr. Giovanni G. Visentin, also known as John, has been Vice Chairman and Chief Executive Officer of Xerox Corp. since May 2018. Mr. Visentin , serves as Executive Chairman of Novitex Enterprise Solutions,  ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD23.46M) is above average for companies of similar size in the US market ($USD6.46M).

Compensation vs Earnings: Insufficient data to compare John's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Giovanni Visentin
Vice Chairman & CEO1.3yrsUS$23.46m0.089% $6.3m
Steven Bandrowczak
President & COO1.2yrsUS$4.24m0.0010% $74.0k
William Osbourn
Executive VP & CFO2.6yrsUS$3.37m0.0015% $109.5k
Hervé N. Tessler
Executive VP & President of EMEA Operations5.6yrsUS$3.67m0.020% $1.4m
Michael Feldman
Executive VP & President of Americas Operations2.6yrsUS$3.57m0.0089% $634.4k
Joseph Mancini
VP & Chief Accounting Officer6.3yrsno data0.024% $1.7m
Naresh Shanker
Senior VP & Chief Technology Officer0.3yrsno datano data
Jennifer Horsley
Vice President of Investor Relations0yrsno datano data
Louis Pastor
Executive VP & General Counsel0.8yrsno datano data
Anne Squeo
Senior VP0.4yrsno datano data

1.3yrs

Average Tenure

55yo

Average Age

Experienced Management: XRX's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Giovanni Visentin
Vice Chairman & CEO1.3yrsUS$23.46m0.089% $6.3m
Nicholas Graziano
Director1.3yrsUS$193.33k0.0021% $151.5k
Ravi Ugale
Board Observer0yrsno datano data
A. Letier
Director1.3yrsUS$188.33kno data
Cheryl Krongard
Director2.6yrsUS$284.17kno data
Joseph Echevarria
Director2.6yrsUS$298.75kno data
Keith Cozza
Chairman of the Board1.3yrsUS$300.00k0.022% $1.6m
Jonathan Christodoro
Director1.3yrsUS$198.33kno data
Sean Carey
Member of Peak Advisory Council9.4yrsno datano data

1.3yrs

Average Tenure

57yo

Average Age

Experienced Board: XRX's board of directors are not considered experienced ( 1.3 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Insufficient data to determine if shareholders have been diluted in the past year.


Top Shareholders

Company Information

Xerox Holdings Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Xerox Holdings Corporation
  • Ticker: XRX
  • Exchange: NYSE
  • Founded: 1906
  • Industry: Technology Hardware, Storage and Peripherals
  • Sector: Tech
  • Market Cap: US$7.112b
  • Shares outstanding: 220.79m
  • Website: https://www.xerox.com

Number of Employees


Location

  • Xerox Holdings Corporation
  • 201 Merritt 7
  • PO Box 4505
  • Norwalk
  • Connecticut
  • 6851
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
XRXNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
XRXSWX (SIX Swiss Exchange)YesCommon StockCHCHFJan 1968
XER1DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968
XRXWBAG (Wiener Boerse AG)YesCommon StockATEURJan 1968
0M21LSE (London Stock Exchange)YesCommon StockGBUSDJan 1968
XRXB34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COM USD1BRBRLAug 2012
XROXBASE (Buenos Aires Stock Exchange)CEDEAR EACH 1 REP 1 COM USD1.00ARARSApr 2019

Biography

Xerox Corporation designs, develops, and sells document management systems and solutions worldwide. It offers intelligent workplace services, including managed print services; digitization services; and digital solutions, such as workflow automation, personalization and communication software, and content management. The company also provides desktop monochrome and color printers, and multifunction printers; copiers, digital printing presses and light production devices, and solutions; graphic communications and commercial printers; inkjet presses; and FreeFlow portfolio of software solutions for the automation and integration of print jobs processing. In addition, it sells paper products, wide-format systems, and network integration solutions, such as xerox business solutions. The company sells its products and services directly to its customers through sales force, as well as through independent agents, dealers, value-added resellers, systems integrators, and the Web. Xerox Corporation was founded in 1906 and is headquartered in Norwalk, Connecticut. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/01 23:52
End of Day Share Price2019/08/01 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.