UPDATE: JPMorgan Downgrades Xerox (XRX) to Underweight
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JPMorgan analyst Paul Coster downgraded Xerox (NYSE: XRX) from Neutral to Underweight with a price target of $20.00 (from $23.00).
The analyst comments "XRX is trading at ~3.8x times our CY21 PF EBITDA estimate, and 7x forward P/E. These are trough level multiples, a discount to the peer group, implying that the stock is currently undervalued. That said, the firm faces secular challenges, disruption from COVID-19 and its ability to execute M&A seems constrained for now, so the equity story lacks catalysts. We are downgrading to Underweight on lack of catalysts, meaning we expect the stock to underperform the mean of our coverage in the next 6 - 12 months, but this is not a call to short the stock given trough-level valuation."
Shares of Xerox closed at $16.81 yesterday.
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