Is Xerox’s Stock a Buy Now?

With shares of Xerox Corp. (NYSE:XRX) trading at around $8.18, is XRX an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

Yes, Xerox is a document management services company, but it’s also a business process company, and an IT outsourcing company. Actually, if you look at the company’s profile, document management services is listed last of the three, which was no doubt done on purpose. Xerox is trying hard to shed its old image, but to be blunt, it’s not working.

When it comes to business process, Xerox is heavily invested and involved. Xerox offers human resource services, finance and accounting, healthcare, technology-based transaction services, and transportation solutions. Xerox purchased Affiliated Computer Services in 2009. Since margins have been low, some people would say this investment was a mistake, but it’s really too early to tell. The biggest selling point is that this investment has allowed Xerox to form long-term contracts with the government. We’ll see how it plays out. For now, let’s take a look at some aspects of the business that are easier to read…