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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Xerox Holdings Corporation (XNAS:XRX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
XRX
Name:
XEROX HOLDINGS CORPORATION (XNAS:XRX)
Sector:
50.00M
Industry:
Information Technology Services
CEO:
Mr. Giovanni Visentin
Total Employees:
22,700
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -83.45% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF XEROX HOLDINGS CORPORATION(XRX) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INFORMATION TECHNOLOGY SERVICES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
15.79
One Month Price Target:
$15.94
Six Month Price Target :
$16.69
Likely Price in One Year's Time:
Ticker:
$17.6
Likely Trading Range Today Under (Normal Volatility)
$15.69
Price Upper limit ($) :
$15.86
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$14.75
This week:
$13.47
This month :
$11.15
Other Primary facts
Market Cap:
2.47B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
155.57M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
12.69%
-18.8%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$20.61
$18.45
$10.97
$13.13
Medium risk (<10%) entry points
Buy Call
Sell Call
$17.74
Buy Put:
Sell Put:
$17.28
$13.83
$14.30
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
XRX
Sharpe Ratio:
-2.52%
Comparison:
XRX, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -238.98% lower than the industry
& is -210.50% lower than the market/S&P 500 average
Average Returns/Yield of
XRX
Daily returns:
-0.07%
Weekly returns:
-0.35%
Monthly returns:
-1.42%
Yearly returns:
14.44%
Comparison of returns:
Average annual returns/yield (last 3 years) is -217.85% below industry average
Classification:
XRX, is amongst the top 40% lowest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.06
Statistical test of Returns:
XRX has yielded a lower return than the market, the results are statistically significant
Volatility (measured by Standard Deviation)
Daily Volatility:
3.17%
Weekly Volatility:
7.08%
Monthly Volatility:
14.16%
Yearly Volatility:
49.04%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.64%
Volatility in last five trading days has been -79.64% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.57%
Weekly VaR:
-14.70%
Monthly VaR:
-29.39%
How Much Can the price of
XRX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-27%
Worst case (decline):
>85%
This translates to price declining to:
$11.56
This translates to price declining to:
$2.37
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
XRX is a 107.45% riskier investment compared to the market/S&P 500 & is 77.72% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 4.34% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
XRX
Beta in relation to market/S&P 500--1.71
Expected beta in 1 year's time:
1.201
Expected beta in 3 year's time:
1.699
Unlevered (debt free) Beta:
1.062
Beta in relation to Nasdaq (XNAS):
0.955
Beta in relation to all global stocks::
0.957
Beta Comparison & Analysis
Beta of competitors/peers::
1.145
Beta is 48.89% higher than peers
Average Industry Beta:
1.209
Beta is 41.10% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
-0.318
Alpha is -1159.35% below industry average alpha yield
Alpha is -2027% below the market average
Analysis of Cost of Capital of
XRX
Equity cost of capital:
0.148
Equity cost of capital is 29.78% above industry mean WACC
Unlevered (without debt) cost of capital:
9.23%
Before-tax cost of debt:
2.36%
After-tax cost of debt:
1.87%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.87%
WACC is 26.58% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$44.97
Revenue growth rate per share of (3Y):
0.59
Annual revenue growth rate is -180.19% below industry average
EPS:
-$3.43
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$3.44
Balance sheet equity growth per share: -8.86%
Equity growth rate per share is -128.27% lower than the industry
Debt per share
$18.13
EBITDA per share
-$1.27
Valuation Analysis Today of
XRX
P/E Ratio:
14.11
P/E Ratio of Competitors/Peers:
38.77
P/E ratio is -63.60% lower than main peers & is -70.27% lower than the industry
-
XRX is -109.70% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $14.28
Present value of the expected future dividends only: $6.74
P/S (Price to Sales ratio):
0.35
Price to sales ratio is -90.39% below the industry mean
P/B (Price to book value ratio):
0.59
Price to free cash flow: 4.59
-
Net income growth rate (3Y):
-250.00%
Net income growth rate is -100.31% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: -8.36%
Dividend yeild: 6.33%
Previous Dividend: $0.25
Previous adjusted dividend: $0.25
Previous Dividend: $1.00
-
-
Average dividend payment (long-term): $0.25
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 31/10/2022
Expected next dividend record date: 28/09/2022
-
Previous dividend payment date: 08/01/2022
Previous dividend record date: 30/06/2022
-
Dividend History:
2022-06-29--$0.25
2021-12-30--$0.25
2021-06-29--$0.25
2022-03-30--$0.25
2021-09-29--$0.25
2021-03-30--$0.25
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
67.42%
Net debt to equity ratio:
61.90%
Debt to assets ratio:
21.56%
Net debt to assets ratio:
19.80%
Debt-to-asset ratio is -66.01% below industry average
Ability to repay debt:
Interest coverage ratio:
-1.96
Interest coverage ratio is -104.69% less than industry average
Looking forward:
Debt growth rate:
0.00%
-
Debt repayment rate in last quarter: 18.63%
Analysis of Key Statistics
Correlation of price movement with the market:
0.648
Statistical significance of correlation:
XRX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.596
Stock price is 8.69% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.596
Correlation of price movement with Nasdaq (^IXIC):
0.064
Covariance of price movement with the market:
0.118
Kurtosis
5.159
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.77
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
XRX
Gross Profit Margin Ratio:
133%
Operating Profit Margin Ratio:
3.32%
Operating profit margin is -147.76% lower than the industry
Net Profit Margin Ratio:
133%
Effective Tax Rate:
10.05%
Effective tax rate is -61.94% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-13.15%
Return on equity (ROE) is -123.37% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
-4.20%
Return on assets (ROA) is -5025.05% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
1.21
Current ratio is -47.68% below industry average
Cash Conversion Cycle (days):
-28.2
Cash conversion cycle is -175.35% below industry average
The remaining useful life of property plant & equipment is: 0.3 years
Stock based compensation to net income ratio:
-2.73%
In-depth Efficiency Analysis
Revenue generated per employee:
308.2K
Each employee generates -27% less revenue than industry average revenue per employee
EBITDA generated per employee:
- 8.7K
Each employee generates -119% less EBITDA than industry average revenue per employee
Profit generated per employee:
- 24.2K
Each employee generates -385% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
2.2K
Each employee generates -133% less free cash flow than industry average revenue per employee
Assets/Capital per employee
375.2K
Each employee generates -133% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- -0.32%
Growth rate in R&D investment/expenditure is -101.03% lower than the industry
Competitors/Peer firms of
XRX
ENVESTNET, INC. (XNYS:ENV)
Q2 HOLDINGS, INC. (XNYS:QTWO)
SAILPOINT TECHNOLOGIES HOLDINGS, INC. (XNYS:SAIL)
FABRINET (XNYS:FN)
KYNDRYL HOLDINGS, INC. (XNYS:KD)
ALIGHT, INC. (XNYS:ALIT)
ALTERYX, INC. (XNYS:AYX)
FASTLY, INC. (XNYS:FSLY)
TERADATA CORPORATION (XNYS:TDC)
Current Analyst Ratings
Strong buy�8%
Buy�17%
Hold�13%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
7.00B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
4.67B
2.32B
314.00M
-
1.73B
-
51.00M
2.09B
4.00M
101.00M
313.00M
- 198000.00K
232.00M
- 550000.00K
- 617000.00K
- 62000.00K
- 550000.00K
Statement of Cash Flow
Date:
Period:
72.00M
Differed Income Tax :
-
Stock Based Compensation :
15.00M
Change in Working Capital :
44.00M
Accounts Receivables:
13.00M
Other Working Capital:
- 10000.00K
Other Non-Cash Items:
- 8000.00K
Net Cash Provided by Operating Activities:
66.00M
Investments in PP&E:
- 16000.00K
Net Acquisitions:
- 54000.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.68B
-
1.68B
1.92B
732.00M
234.00M
4.57B
604.00M
3.30B
240.00M
-
528.00M
3.84B
8.52B
-
13.08B
1.18B
1.45B
-
-
1.14B
3.77B
2.82B
2.29B
5.11B
-
8.88B
156.00M
5.53B
- 3032000.0K
-
March 31, 2022 at 6:00:00 AM
6.76B
4.18B
13.07B
-
4.27B
2.6B
-
- 5000.00K
- 75000.00K
- 646000.00K
-
- 113000.00K
- 46000.00K
656.00M
- 149000.00K
10.00M
- 148000.00K
1.76B
1.91B
66.00M
- 16000.00K
50.00M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
XRX
2023
2024
2025
2026
2027
$17.66
$19.68
$21.93
$24.45
$27.25