Xerox Corporation (XRX) recently announced that one of its fully owned subsidiaries, Global Imaging Systems (GIS) has acquired Bennett’s Business Systems, Inc., headquartered in Jacksonville, Florida. Apart from Jacksonville, Bennett’s also has two other offices in Orlando and Tallahassee.
After the acquisition by the Xerox subsidiary, the company will become part of Saxon Business Systems, Inc., another company owned by GIS based in Miami Lakes, Florida. Saxon Business Systems, the largest Xerox Copier dealer in Florida, was acquired by GIS three years back.
Bennett’s, an independent distributor of Canon Inc. (CAJ) and Hewlett-Packard Company (HPQ) copiers, printers and multifunction systems, will soon start offering Xerox’s full range of office printing products. This new addition to the GIS community is a part of the company’s plan to strengthen its nationwide network of locally-based providers focused on improving its document management and office efficiency for small and mid-size businesses.
Earlier, Xerox had acquired four other companies this year including Virginia-based Miller Technology Solutions, Inc., New York-based Xerographic Solutions, Inc., Iowa-based Midwest Business Solutions Inc. and Premier Office Equipment Inc., Illinois-based United Business Solutions and Pensacola-based Florida Imaging & Network Systems – all through its wholly owned subsidiary, GIS.
In the last reported quarter, Xerox earned adjusted net income of $393 million or 27 cents per share compared with $342 million or 24 cents per share in the year-ago quarter. Revenues increased marginally by 2% year over year to $5.61 billion, driven by lower sales. The company expects to witness better performance going forward based on its attempt to grow and expand its business, particularly Business Process Outsourcing.
Consequently, Xerox has projected adjusted earnings in the range of $1.07 to $1.12 per share for full-year 2011. However, intensifying competition and availability of substitutes for the company’s products have put the company on the back foot.
Thus, the shares of Xerox Corp. are maintaining a Zacks #3 Rank, which translates to a recommendation of Hold for the short term (1 to 3 months) and we reiterate our recommendation of Neutral for the long-term (more than 6 months).
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