Xerox (XRX) reported earnings on Tuesday beating q3 estimates by a penny and confirming full year estimates of $1.08 to $1.11. Nothing spectacular, but steady. The main thing I liked about their earnings was the consistency. This is at least the 4th quarter in a row they beat estmitates by just $.01 which I interrupt as they have a solid handle on their business and are able to mange it to expectations now. Their announcements says that 83% of their revenue is annuity business, and over half is now services revenue. I suspect that number might have some positive spin associated with it, but never the less it does indicates a potential high degree of predictability in the future business. I'm not aware that the company has set expectations for 2012, but average analyst estimates are $1.19. With the stock trading just over $8 that is a forward pe of just 7.
At Oct. option expiration date, CCI was assigned a fourth lot at a cost of $9. We now have a full position of shares at an average cost of around $10. Still thinking the market will pin a more normal multiple on this company as it becomes more comfortable with its transition to a services business. Hence CCI still has a "price target" in the low teens and will hold for awhile longer. However, if the stock does not move by year end we will consider selling some shares to harvest tax losses.