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Opinion: Consumer Printing a Record of Growth With consumers snapping up color-photo printers and multifunction devices, outfits like HP and Lexmark could surprise investors At first glance, it might seem a bit strange that Evergreen Technology Fund manager John Rutledge has poured nearly $1 million into Hewlett-Packard (HPQ ) shares not for its booming PC business nor its servers and storage equipment — but for its printers. Rutledge likes that business’ prospects so much that he also invested an additional 4% of the $18 million he manages into printer maker Lexmark.
At a time when tech investors snap up shares of PC makers (figuring corporate users will be upgrading their old machines) or networking-gear suppliers (considering the proliferation of wireless networks), the printer sector gets no respect. Investors have largely overlooked the market. Heavyweight HP receives 31% of its revenue from imaging and printing devices. Yet, although it has launched a splashy marketing campaign, its stock is trading at $24 — or just 15 times 2005 earnings vs. p-e’s of 20 to 30 times 2005 earnings for many tech outfits.
REAL-TIME PIX. Yet segments of the printer market are expected to enjoy faster growth and higher margins than many other tech areas.
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