Lexmark International Earnings: Here’s Why the Stock is Crashing Now

Lexmark International Inc. (NYSE:LXK) delivered a profit and missed Wall Street’s expectations, BUT beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down over 5%.

Markets are at 5-year highs! Discover the best stocks to own. Click here for our fresh Feature Stock Pick now!

Lexmark International Inc. Earnings Cheat Sheet

Results: Net income decreased -91.34% to $6 million (61 cents per diluted share) in the quarter versus a net gain of $69.3 million in the year-earlier quarter.

Revenue: Decreased 8.73% to $967 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Lexmark International Inc. reported adjusted net income of 61 cents per share. By that measure, the company missed the mean analyst estimate of $0.9. It beat the average revenue estimate of $934.03 million.

Guidance: In the first quarter of 2013, the company expects a continued negative impact from the decision to exit inkjet. Revenue is currently expected to decline 11 to 13 percent year on year. GAAP earnings per share in the first quarter of 2013 are expected to be around $0.43 to $0.53, compared with GAAP earnings per share of $0.84 in the first quarter of 2012. Non-GAAP earnings per share in the first quarter of 2013 are expected to be around $0.80 to $0.90, compared with non-GAAP earnings per share of $1.05 in the first quarter of 2012.

Key Stats:

Revenue increased 5.2% from $919.2 million in the previous quarter. Net income increased to $6 million in the quarter versus a net loss of $0 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $1.01 and has not changed. For the current year, the average estimate has moved up from a profit of $3.77 to a profit of $3.78 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials.)