Stock price closing in on Kodak. Awesome job Xerox!
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Don't laugh at Kodak.
They have a 2.2% chance of bankruptcy in the next 24 months.
Xerox is at 35.3%
https://valueinvesting.io/XRX/probability-of-bankruptcy
Despite all the optimism it feels like this year is going to be the end game when lexmark and itsavvy flop
My guess is we will be around $1 come summer which is higher than fair market value.
If Xerox has 1000 sales reps and decides to layoff 300 the SLT projects 40% increase in sales productivity back to growth! Makes perfect sense right?
Dividend cut was already announced in conjunction with the Lex merger.
It's $0.50 now for the dividend?
Oh, that's bad! It reads on CNBC and all the stock sites as $1.00 still.
https://www.nasdaq.com/market-activity/stocks/xrx/dividend-history
So, the last dividend paid out at $0.25/Q or $1.00/Yearly on 12/31, and the one that goes ex-dividend on 3/31 will be $0.125/Q or $0.50/yearly? That's when the rails come off. These dividend people are going to get 1/2 their money on a stock that will be worth god knows what in two months, and they'll all get notified on the same day.
The dividend is now fifty-cents, not a dollar (part of the Lexmark acquisition announcement).
The issue is that should have happened during Covid to retain talent, pay the company 401K match, fund the pension, and create real severance packages for the downsizing.
At the current burn rate, well they are already burning negative value numbers, so cash-flow is barely allowing continuing operations...
It's a slow death dance unless Lexmark and IT Savvy really make an enormous difference that nobody is predicting.
Market cap now below $1B… the clock is ticking.
https://www.suredividend.com/overly-risky-stocks-high-dividend-yields/
That's not even the worst part. The worst part is that XRX pays out a $1/year with money it doesn't even have. It's a $124.43 Million dollar bribe to keep the dividend people holding on to the stock. It's a yield of 12.62% - and will only go up as the price drops, attracting d-mber and d-mber dividend chasers. At some point in the future that dividend will be cut, that's when the crash happens. These dividend investors might be the only thing keeping this above $2.
Dividends are profit sharing, but there is no profit to share. Every time there is a layoff, or a budget is cut, part of it is to pay that dividend to keep people from tanking the stock.