Investors Purchase High Volume of Xerox Put Options (NASDAQ:XRX)

Key Points

• Unusually large put buying: Investors purchased 1,689 put options on Xerox on Wednesday, a roughly 1,369% increase over the average daily volume of 115 puts, indicating elevated bearish positioning.
• Wall Street sentiment is negative: Analysts have an average "Sell" rating with a $2.50 average price target, and several firms recently lowered or reaffirmed negative views on the stock.
• Weak fundamentals and small market cap: Xerox reported an EPS miss with a negative net margin and high debt-to-equity (8.94), trades near $1.57 with a ~$205 million market cap, and pays a $0.025 quarterly dividend (about a 6.4% yield).

Xerox Holdings Co. (NASDAQ:XRX - Get Free Report) saw unusually large options trading on Wednesday. Stock investors acquired 1,689 put options on the stock. This is an increase of approximately 1,369% compared to the average daily volume of 115 put options.

Institutional Trading of Xerox

Several institutional investors have recently added to or reduced their stakes in XRX. S Harris Financial Group LLC bought a new position in Xerox during the 4th quarter valued at $25,000. Captrust Financial Advisors bought a new stake in shares of Xerox in the 2nd quarter worth about $58,000. Williams & Novak LLC bought a new stake in shares of Xerox in the 4th quarter worth about $27,000. Socha Financial Group LLC acquired a new stake in shares of Xerox in the 3rd quarter valued at about $43,000. Finally, Boothbay Fund Management LLC bought a new position in shares of Xerox during the third quarter worth about $43,000. 85.36% of the stock is owned by institutional investors and hedge funds.

Wall Street Analysts Forecast Growth

Several equities research analysts recently commented on XRX shares. Zacks Research lowered Xerox from a "hold" rating to a "strong sell" rating in a research report on Tuesday, March 3rd. Citigroup reaffirmed a "neutral" rating and issued a $2.50 price objective (down from $3.50) on shares of Xerox in a research report on Friday, January 30th. Finally, Weiss Ratings reiterated a "sell (d-)" rating on shares of Xerox in a research note on Monday. One research analyst has rated the stock with a Hold rating and two have assigned a Sell rating to the stock. According to data from MarketBeat, Xerox has an average rating of "Sell" and an average price target of $2.50.

Xerox Stock Down 1.3%

Shares of Xerox stock opened at $1.57 on Thursday. Xerox has a 1-year low of $1.19 and a 1-year high of $6.80. The company has a market capitalization of $205.32 million, a PE ratio of -0.19 and a beta of 1.80. The company has a debt-to-equity ratio of 8.94, a current ratio of 1.11 and a quick ratio of 0.79. The business has a 50-day moving average of $1.56 and a 200-day moving average of $2.27.

Xerox (NASDAQ:XRX - Get Free Report) last issued its quarterly earnings results on Thursday, January 29th. The information technology services provider reported ($0.10) EPS for the quarter, missing analysts' consensus estimates of $0.15 by ($0.25). Xerox had a negative net margin of 14.65% and a negative return on equity of 8.26%. The business had revenue of $2.03 billion during the quarter, compared to analysts' expectations of $2.08 billion. During the same period in the prior year, the company posted $0.36 EPS. The company's revenue for the quarter was up 25.7% on a year-over-year basis. As a group, equities analysts forecast that Xerox will post 0.29 EPS for the current fiscal year.

Xerox Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Thursday, April 30th. Stockholders of record on Tuesday, March 31st will be paid a dividend of $0.025 per share. This represents a $0.10 annualized dividend and a dividend yield of 6.4%. The ex-dividend date is Tuesday, March 31st. Xerox's dividend payout ratio is -1.22%.

About Xerox

Xerox Holdings Corporation NYSE: XRX is a global provider of document management technology and services. The company designs and manufactures a broad range of multifunction printers, production printers, digital presses and related consumables. In addition to its hardware offerings, Xerox delivers software and workflow automation solutions, managed print services and cloud-based document platforms that help organizations optimize their information-intensive processes.

Founded in 1906 as The Haloid Photographic Company, Xerox pioneered xerographic imaging in the late 1940s, launching the first plain-paper copier in 1959.

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