LEXMARK EARNINGS DOWN 11% , TO UP INK & TONER PRICES

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LEXMARK EARNINGS DOWN 11% , TO UP INK & TONER PRICES

 user 2008-10-23 at 10:46:57 am Views: 57
  • #20720
    http://blogs.barrons.com/techtraderdaily/2008/10/22/lexmark-ups-ink-toner-prices-citi-turns-bullish/
    Lexmark Ups Ink, Toner Prices; Citi Turns Bullish
    Lexmark
    (LXK) shares are on the mend this morning after Citigroup’s Richard
    Gardner upped his rating on the stock to Buy from Hold. His price
    target on the shares is $37, which is actually down a buck from $38.

    Gardner
    notes that the company has announced plans to follow Hewlett-Packard
    (HPQ) and raise prices on ink and toner by about 5%, a move which he
    says should have a significant positive impact on 2009 EPS. He says
    that while the inkjet business is “permanently impaired,” the company
    is executing well in laser printers, earning 15%-20% operating margins
    in that segment. Valuation, at 4x forward operating earnings ex net
    cash, “is extremely compelling,” he contends.Gardner trimmed his ‘08
    EPS estimate to $3.85 from $3.91, but he upped ‘09 to $4 from $3.57.LXK
    today is up 55 cents, or 2.1%, to $26.26.

    http://www.marketwatch.com/news/story/lexmark-internationals-quarterly-net-earnings/story.aspx?guid={F146A52B-9D0A-4F65-88C2-51C309D98825}&dist=msr_10
    Lexmark shares fall 11% as earnings disappoint
    SAN
    FRANCISCO — Lexmark International Inc. shares fell more than 11%
    Tuesday after the printing and imaging company reported a 19% drop in
    its third-quarter earnings and said business is likely to remain
    challenging in light of economic conditions through the fourth quarter.

    LXK
    26.66, +0.15, +0.6%) shares ended the day down $3.28 to $25.71 after
    the company said it earned $36.6 million, or 42 cents a share, down
    from $45.2 million, or 48 cents, earned in the same period during
    2007.Excluding restructuring charges and other one-time items, Lexmark
    said it would have earned 63 cents a share. By that measure, the
    company met the estimate of analysts surveyed by FactSet
    Research.Lexmark’s reported revenue of $1.13 billion, down slightly
    from the nearly $1.2 billion it reported a year ago.In a statement,
    Lexmark Chief Executive Paul Curlander said the company was facing “a
    more difficult global economic environment,” but that Lexmark remains
    focused on its strategy of targeting higher usage segments of the
    printing market.

    Lexmark said that during its third quarter, its
    business segment revenue rose 4% from a year ago to $760 million, but
    consumer sales dropped by 21% to $371 million. The company said the
    consumer segment declines were due primarily to a shift in business
    strategies and a slowdown in the inkjet market.For its fourth quarter,
    Lexmark estimates earnings, excluding one-time items of between 70
    cents and 80 cents a share, while Wall Street analysts have forecast a
    profit of 82 cents a share.The company’s estimate excludes
    restructuring charges pegged at about 30 cents a share.Lexmark also
    forecast that revenue for the current quarter will de down from last
    year at a percentage rate in the “low-to-mid teens.