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Xerox yet again

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7

June 18, 2013 – Comments (7) | RELATED TICKERS: XRX , DDD

I've been suggesting this stock for awhile now, and I own it real life.  I just wanted to share an interesting interview  with Xerox's CTO.  You don't have to watch the whole thing but fast forward at least to the end where the CTO actually displays something Xerox developed: chiplets.  These enable you to actually use them in 3D printing, enabling printing of circuitry.

http://us.rd.yahoo.com/finance/external/bloomberg/SIG=12sk7cnhe/*http://www.bloomberg.com/video/xerox-cto-vandebroek-on-outlook-oiyZS57PQgCXubFC1niz_A.html?cmpid=yhoo

The stock hit a new high today so I would wait for a pullback which, if Cramer is correct the market will tank tomorrow, you may get one.  Or you can sell puts and hope to get put the stock at a discount.  The company is doing a massive stock buyback, it pays a decent dividend.  It transformed its business away from stodgy printing into more lucrative IT and it sells at a low P/E.  While Europe will still be a small drag, Xerox gives you valuation, transformation, pays a better yield than any bank, and you have a future catalyst in innovation.

7 Comments – Post Your Own

#1) On June 19, 2013 at 12:14 PM, L0RDZ (82.49) wrote:

Dang Wall  E   you  haven't  sold  out  yet ?  

According to the  good folks here at  caps  Xerox has  underperformed  the  sp   for  quite a  while.

Xerox  does  not  pay  a better yield  than  the  banks  or  financials  i'm  in...

One reason  for  not buying  its  CEO...

That  and  copiers  old school copiers  are  like  a dying  breed.

I'm surprised  you didn't  hint  that apple  is gonna buy them... LOL...

FYI  Apple isn't going to buy  xerox.

 

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#2) On June 19, 2013 at 12:53 PM, awallejr (81.42) wrote:

Oh I know they wont but that chiplet technology looks interesting.  As for Xerox underperforming the S&P, you are right, but I see this selling for $12-15 in a couple years (assuming no black swans).  Since my cost basis is $7  that will turn into a nice profit assuming I sell (which I probably wont).  Also I wrote about 50 put contracts which I expect to expire without my being put the stock, so "free" money for a commitment I didn't expect to be called on.

You might want to look at the Jan 2015 $10 puts.  You can get about $1.90ish now.

Out of curiosity what bank is giving you about 2.5%?  I am not referring to stocks, I was referring to bank accounts.

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#3) On June 19, 2013 at 1:11 PM, L0RDZ (82.49) wrote:

So now  you wanna  compare  a  stock (in this case xerox) (total underperformer to index)  to  the  rate  banks pay on  deposits ?

Personally IMHO  you'd  do much better buying  some  Linn energy  than  you would  holding  onto xerox.

Much better  distribution  as  well.

LINE

is  the ticker...

or

LNCO for those  not  wanting to deal  with  K-1's

 

 

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#4) On June 19, 2013 at 1:39 PM, awallejr (81.42) wrote:

No I was referring to the dividend received to interest you get on cash.  And actually XRX has been outperforming the S&P for this year and has crushed LINE as well.  Excluding the dividend it is up over 25% this year.

I used to advise LINE back in 2009, but sold out years ago.  This recent bear attack on LINE over its BRY deal makes it either opportunistic or dangerous.

If you have been following me I have advised over and over MLPs, BDCs and REITs.  They have corrected over this whole media created "taper" nonsense, but their yields will still beat cash for years to come. I stopped listening to Bloomberg radio between 10am-2pm.  I can't stand Vonnie Quinn.  I got sick of listening to her asking every guest every day for months "so what about Greece" and she is doing it again with "so what about tapering."

I am not arguing that XRX is the best stock to buy.  I like diversity in my portfolio and I see continued upside potential here.

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#5) On June 19, 2013 at 1:48 PM, Valyooo (99.54) wrote:

They need more commercials with that hot chick

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#6) On June 19, 2013 at 2:00 PM, L0RDZ (82.49) wrote:

You  are  picking  and  choosing  your  timeline  on xrx...  rather well.  in  that  only ytd   does  xrx  look  decent  compared to the spy.

if  you expand  it  say  to  an  one year  period  the chart looks  bad  except  for  a small period in april  and  one  last year around  june.

Again  I'd bet that  line  crushes  xerox  rest of  the year out.

I won't  even  talk  about  the  9-10%  dividend..

at  these prices...    I  held  onto  line  and   I'm  please  to enjoy my 18%  dividend  from  my  strategic  purchases.

 

 

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#7) On June 19, 2013 at 2:20 PM, awallejr (81.42) wrote:

Oh I agree there Valyoo.

I can say the same with you Lordz.  A year to date timeline is perfectly common to use when discussing performance.  Year over year is another I suppose.

I hope LINE performs well for you, but we are comparing apples to oranges.

But then what percentage performance will you make if you sell the puts I suggested in #2 and then close them out for 1cent come January 2015 which I submit (again absent any black swans) you will be able to do.

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