UPDATE: Citigroup Initiates Lexmark International at Sell on Difficult Transition Ahead

Citigroup initiated coverage on Lexmark International LXK with a Sell rating and a $18 price target. Citigroup commented, "We are initiating on Lexmark shares with a Sell rating and a $18 target price as we continue to have concerns about the company's ability to grow revenue and operating income over the medium to long term given unfavorable secular demand trends (mobility and cloud) coupled with weak macro trends which are likely to hamper print demand trends. While the company's recent announcement to restructure their businesses by exiting the inkjet business is a positive longer term, we believe near to mid term fundamentals remain challenged and we expect the road to recovery from recent restructuring to be a painful one. We expect estimates to come lower over time as the exit of the inkjet business is factored in." Lexmark International closed at $22.10 on Monday.