Atlanta, GA 7/13/12 (StreetBeat) – Lexmark International Inc (NYSE: LXK) hits a 2 year low as its 2nd quarter results were hit by weak sales in Europe and a stronger dollar. Its revenue fell about 12%, much more than anticipated.
American technology companies have been lowering their estimates citing the deteriorating economic condition in Europe. A stronger dollar doesn’t help this situation either, where the euro has shed 5.5% against the dollar this year. Lexmark relies on nearly 40% of its sales coming from Europe, the Middle East, and Africa.
"This revised second quarter outlook reflects a weaker-than-expected demand environment, particularly in Europe, and a larger-than-expected impact from unfavorable changes in currency exchange rates," the company said.
The health of the printer market has been dwindling down, as the industry becomes more dominated by new computing devices such as tablets. Barclays lowered its price target Thursday on multiple printer companies, Lexmark, Xerox (NYSE: XRX) and Hewlett-Packard Co (NYSE: HP) in particular. Analyst Ben Reitzes cut his price target on Lexmark to $21, saying "We see yesterday's pre-announcement as a negative indicator on the health of the printer market as well as overall IT demand, with particular implications for both Xerox and HP,"
Lexmark Inc is one of the biggest NYSE % losers Friday, trading down 14% at $20.90. HP was down about 2 percent and Xerox down 1.2 percent.
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