Jabin Bastian
2 min read
What Happened?
Shares of document technology company Xerox (NASDAQ:XRX) fell 6% in the morning session after Investors continued to bid down on Citi’s downgrade from Thursday. According to TheFly, analyst Asiya Merchant cut the stock to Sell from Neutral and lowered the price target to $2.50 from $3.45. She cited concern about free-cash-flow generation and the stock’s valuation. She told investors that a path to lasting revenue growth and stronger free cash flow still depends on execution in a print market that is structurally challenged. The new target was about 17% below the $3.01 close ahead of that note.
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What Is The Market Telling Us
Xerox’s shares are extremely volatile and have had 60 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 3.8% on the news that Citi downgraded the company to Sell from Neutral with a $2.50 price target. Citi analyst Asiya Merchant lowered her rating and cut the price target to $2.50 from $3.45, implying approximately 17% downside from the previous session’s $3.01 close, in research reported by StreetInsider. Merchant highlighted mounting execution risks in Xerox’s reinvention strategy, noting potential demand pull-forward in its IT Solutions segment and integration friction from sales force reorganization.The rating cut establishes Citi as the Street-low target among major brokerages, breaking from a consensus Hold. The downgrade also coincided with broader pre-market equity declines ahead of Xerox’s scheduled late-October earnings print.
Xerox is up 11.2% since the beginning of the year, but at $2.74 per share, it is still trading 24.7% below its 52-week high of $3.63 from October 2025. Despite the year-to-date gain, investors who bought $1,000 worth of Xerox’s shares 5 years ago would now be looking at only $132.13.
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