Xerox Holdings Corporation (NASDAQ:XRX) First-Quarter Results: Here's What Analysts Are Forecasting For This Year

There's been a notable change in appetite for Xerox Holdings Corporation (NASDAQ:XRX) shares in the week since its first-quarter report, with the stock down 12% to US$14.18. Revenues were US$1.5b, with Xerox Holdings reporting some 4.1% below analyst expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for Xerox Holdings

Following the recent earnings report, the consensus from five analysts covering Xerox Holdings is for revenues of US$6.52b in 2024. This implies a discernible 2.3% decline in revenue compared to the last 12 months. Xerox Holdings is also expected to turn profitable, with statutory earnings of US$2.18 per share. Before this earnings report, the analysts had been forecasting revenues of US$6.59b and earnings per share (EPS) of US$2.25 in 2024. The analysts seem to have become a little more negative on the business after the latest results, given the minor downgrade to their earnings per share numbers for next year.

The consensus price target held steady at US$16.20, with the analysts seemingly voting that their lower forecast earnings are not expected to lead to a lower stock price in the foreseeable future. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on Xerox Holdings, with the most bullish analyst valuing it at US$19.00 and the most bearish at US$14.00 per share. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would also point out that the forecast 3.1% annualised revenue decline to the end of 2024 is better than the historical trend, which saw revenues shrink 6.4% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 4.8% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect Xerox Holdings to suffer worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Xerox Holdings. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$16.20, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Xerox Holdings going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Xerox Holdings (1 is a bit concerning) you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.