Lexmark Slammed (LXK): Tech Trends Show Printing Could be a Dodo

July 13, 2012 11:28 AM EDT
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Technology Select Sector SPDR (NYSE: XLK) is up over 9 percent year-to-date, and it would be higher by an even larger amount if it didn't have to carry shares of Hewlett-Packard (NYSE: HPQ) Lexmark (NYSE: LXK) Xerox (NYSE: XRX) on its back. Shares of all of these companies are lower this year.

Share of Lexmark are down 14 percent today after it warned about earnings, but that is just the tip of the iceberg, so to speak.

Yesterday, analysts at Ben A. Reitzes of Barclay's discussed issues in the industry. A particular point worth noting in that Reitzes thinks younger workers are doing less printing (and more with mobile apps), and this could create structural problems in the printing business.

"Younger workers may not be printing as much given different work habits and higher adoption rates of mobile devices," said Reitzes.

According an average analyst estimate compiled by Bloomberg, Lexmark's sales are projected to slip 4.4 percent to $4 billion this year. Many see this as a sign of an industry-wide slow down.

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