UPDATE: BMO Capital Markets Raises PT on Xerox Following June Quarter Report

In a report published Friday, BMO Capital Markets analyst Keith Bachman reiterated an Outperform rating on Xerox Corporation XRX, and raised the price target from $10.00 to $11.00. In the report, BMO Capital Markets noted, “All said and done, XRX reported top-line and EPS beat in the June quarter. Revenue beat was driven by better printing revenues, while EPS beat of ~$0.02 was driven by better services margins and prudent expense management...We retain our Outperform rating on XRX. We still like XRX story. Our longer-term thesis is that as the percentage of revenues from services increase, the multiple will increase. In addition, we think improving services margins will both help increase earnings and help investor confidence in the stock. We project services to be between 58% and 60% of total revenues by the end of 2014, from 55% as of the June 2013 quarter.” Xerox Corporation closed on Thursday at $9.80.