Xerox Target of Unusually High Options Trading (NASDAQ:XRX)

Key Points

• Xerox saw unusually heavy call-option activity on Thursday, with 10,301 call options purchased—about 130% above its average daily volume.
• Analyst sentiment remains cautious: Xerox has a consensus rating of “Reduce” and a $2.50 target price, while its shares traded at $3.37 after rising $0.73.
• The company’s latest quarterly results beat expectations, reporting an adjusted loss of $0.11 per share versus an expected loss of $0.20, while revenue increased 26.7% year over year to $1.85 billion.

Xerox Holdings Co. (NASDAQ:XRX - Get Free Report) was the target of unusually large options trading activity on Thursday. Stock investors acquired 10,301 call options on the stock. This represents an increase of approximately 130% compared to the average daily volume of 4,479 call options.

Wall Street Analyst Weigh In

Several brokerages recently commented on XRX. Weiss Ratings reiterated a "sell (d-)" rating on shares of Xerox in a research note on Friday, July 24th. Zacks Research upgraded shares of Xerox from a "strong sell" rating to a "hold" rating in a research note on Thursday, April 30th. Two research analysts have rated the stock with a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, Xerox has a consensus rating of "Reduce" and a consensus target price of $2.50.

Xerox Stock Performance

XRX stock traded up $0.73 on Thursday, hitting $3.37. The company's stock had a trading volume of 15,297,203 shares, compared to its average volume of 4,750,198. The firm has a 50 day moving average of $3.00 and a two-hundred day moving average of $2.30. Xerox has a 1 year low of $1.19 and a 1 year high of $5.22. The stock has a market cap of $441.12 million, a price-to-earnings ratio of -0.42 and a beta of 2.40. The company has a current ratio of 1.18, a quick ratio of 0.85 and a debt-to-equity ratio of 14.04.

Xerox (NASDAQ:XRX - Get Free Report) last issued its quarterly earnings data on Thursday, April 30th. The information technology services provider reported ($0.11) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.20) by $0.09. The company had revenue of $1.85 billion for the quarter, compared to the consensus estimate of $1.78 billion. Xerox had a negative net margin of 14.09% and a negative return on equity of 12.08%. Xerox's revenue for the quarter was up 26.7% on a year-over-year basis. During the same period last year, the firm posted ($0.06) EPS. Equities analysts predict that Xerox will post 0.03 EPS for the current fiscal year.

Xerox Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, July 31st. Stockholders of record on Tuesday, June 30th will be paid a dividend of $0.025 per share. The ex-dividend date is Tuesday, June 30th. This represents a $0.10 annualized dividend and a dividend yield of 3.0%. Xerox's dividend payout ratio is -1.20%.

Hedge Funds Weigh In On Xerox

Institutional investors have recently added to or reduced their stakes in the stock. AQR Capital Management LLC lifted its position in Xerox by 71.7% during the 1st quarter. AQR Capital Management LLC now owns 345,631 shares of the information technology services provider's stock worth $1,661,000 after acquiring an additional 144,280 shares during the period. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. increased its holdings in shares of Xerox by 4.3% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 69,047 shares of the information technology services provider's stock valued at $333,000 after purchasing an additional 2,838 shares during the period. Goldman Sachs Group Inc. raised its stake in shares of Xerox by 37.7% during the first quarter. Goldman Sachs Group Inc. now owns 1,575,229 shares of the information technology services provider's stock worth $7,608,000 after purchasing an additional 431,349 shares during the last quarter. Empowered Funds LLC lifted its holdings in shares of Xerox by 2.1% during the first quarter. Empowered Funds LLC now owns 619,381 shares of the information technology services provider's stock worth $2,992,000 after purchasing an additional 12,633 shares during the period. Finally, UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC lifted its holdings in shares of Xerox by 9.2% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 600,018 shares of the information technology services provider's stock worth $2,898,000 after purchasing an additional 50,467 shares during the period. Institutional investors and hedge funds own 85.36% of the company's stock.

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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