Xerox Holdings Corp. (XRX) Stock: Reports Positive Q2 Earnings

• 1 XRX Stock rallied 4.74% in a week, 8.32% in three months and 13.75% YTD. 
• 2 Xerox Holdings reported earnings on July 25, 2023, where EPS surpassed expectations by 34.05%. 

Xerox Holdings Corp. (NASDAQ: XRX) posted positive second-quarter earnings on July 25, 2023, but the revenue fell short, and the XRX stock is up by 2.63%. While investors are busy scrutinizing the alterations in the variables, some key metrics always offer a clear picture mainly because they influence the top and bottom-line performance of the company. 

Xerox Holdings Corp. (XRX) Stock: Financial Analysis

Steve Bandrowczak, CEO of Xerox, says that in the last 12 months, the company has made noticeable changes to strengthen its financial and operational direction. These changes led to another profitable quarter with a pinch of macroeconomic backdrop. For the remaining 2023, the company aims at a revenue of $7.1 Billion and forecasts the free cash flow to be around $600 Million. 

In the last four quarters, Xerox Holdings Corp. has surpassed the consensus earnings per share (EPS) estimates three out of four times. Connecticut-based Xerox remains a leader in the contractual print and document service market, despite the decline in the demand for paper-related systems due to the digital revolution. 

The company aims at paying about 50% of its free cash flow to holders. Currently, it pays a dividend of $1.00 per share with a yield of 6.5%. 

Xerox Holdings Corp. (NASDAQ: XRX): Financial Analysis

At press time, XRX stock is trading at $16.79 with a jump of 2.63%; previous close and open both were at $16.36. The 52-week range is from $11.80 to $19.40, indicating that the current price could create new highs. With a volume of 2.10 Million shares, the market cap is $2.638 Billion. 

The trailing twelve-month (TTM) EPS is negative $1.74. Analysts might not be happy with the Q2 2023 earnings report, placing the price target at $12.75 with a 24.1% downside. At the same time, it provided a 1.00 rating for strong sales. 

Xerox reported its Q2 2023 earnings on July 25, 2023, where the reported revenue of $1.754 Billion failed to beat the estimate by 0.03% with a surprise of negative $478.241K. At the same time, the reported earnings of $0.44 per share surpassed the expected value of $0.316 by 34.05%. 

The company held around $477 Million in cash and equivalents, and the operating cash flow for the last quarter was $95 Million. Free cash flow in Q1 2023 was $70.00 Million, a jump of 40.00% from the previous quarter. While in Q2 2023, the free cash flow is reported to be $165.00 Million gaining 268.73% from Q1. 

Revenues from its various verticles were promising. It gained $49 Million from financing. At the same time, supplies, paper, and other sales raked in $276 Million and equipment sales collected $420 Million. The services, maintenance, and rental sector got $1.01 Billion and the post-sales revenue was $1.33 Billion. 

Xerox Holdings Corp. (XRX) Stock: Candle Exploration

The recent jump in earnings caused it to break the descending EMA. If the trend continues, the price might cross the crucial resistance, which it has been trying to break for some time. If so, the price could enter the supply zone. However, a bullish trend could be seen if the price crosses the $19.39 mark. 

If the price falls from here and crosses the crucial support, it could bounce off the buying zone to rally ahead. Overall, the speculations say that the price should consolidate in the expected range forming a base to rally ahead. 

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