Critical Contrast: Eastman Kodak (NYSE:KODK) & Xerox (NASDAQ:XRX)

Eastman Kodak (NYSE:KODK) and Xerox (NASDAQ:XRX) are both small-cap technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, valuation, risk, institutional ownership, profitability and dividends.

Insider and Institutional Ownership

33.6% of Eastman Kodak shares are held by institutional investors. Comparatively, 85.4% of Xerox shares are held by institutional investors. 21.3% of Eastman Kodak shares are held by company insiders. Comparatively, 1.5% of Xerox shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Eastman Kodak and Xerox’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastman Kodak	-8.28%	-14.47%	-5.55%
Xerox	-11.93%	17.61%	0.65%

Risk & Volatility

Eastman Kodak has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500. Comparatively, Xerox has a beta of 2.4, meaning that its stock price is 140% more volatile than the S&P 500.

Earnings and Valuation

This table compares Eastman Kodak and Xerox”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastman Kodak	$1.07 billion	0.87	-$128.00 million	($1.39)	-6.82
Xerox	$7.02 billion	0.06	-$1.03 billion	($7.38)	-0.44

Eastman Kodak has higher earnings, but lower revenue than Xerox. Eastman Kodak is trading at a lower price-to-earnings ratio than Xerox, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations for Eastman Kodak and Xerox, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastman Kodak	1	0	0	0	1.00
Xerox	1	2	0	0	1.67

Xerox has a consensus price target of $3.45, suggesting a potential upside of 6.81%. Given Xerox’s stronger consensus rating and higher possible upside, analysts plainly believe Xerox is more favorable than Eastman Kodak.

Summary

Xerox beats Eastman Kodak on 8 of the 13 factors compared between the two stocks.

About Eastman Kodak

Eastman Kodak Company engages in the provision of hardware, software, consumables, and services to customers in the commercial print, packaging, publishing, manufacturing, and entertainment markets worldwide. The company operates through three segments: Print, Advanced Materials and Chemicals, and Brand. The Print segment provides digital offset plate offerings and computer-to-plate imaging solutions; press systems and components under the PROSPER brand name, as well as print inks and primers under the KODAK OPTIMAX, KODACHROME, and KODAK EKTACOLOR brand names; and PRINERGY, a workflow production software, which is used by customers to manage digital and conventional print content from file creation to output. This segment offers its products to commercial industries, including commercial print, direct mail, book publishing, newspapers and magazines, décor, and packaging/labels. The Advanced Materials and Chemicals segment engages in industrial film and chemicals, motion picture, advanced materials and functional printing, and IP licensing and analytical activities. This segment also comprises the Kodak Research Laboratories, which conducts research, develops new product or new business opportunities, and files patent applications for its inventions and innovations, as well as manages licensing of its intellectual property to third parties. The Brand segment engages in the licensing of Kodak brand to third parties. The company is also involved in the operation of Eastman Business Park, a technology center and industrial complex. It sells its products and services through direct sales, third party resellers, dealers, channel partners, and distributors. The company was founded in 1880 and is headquartered in Rochester, New York.

About Xerox

Xerox Holdings Corporation, together with its subsidiaries, operates as a workplace technology company that integrates hardware, services, and software for enterprises in the Americas, Europe, the Middle East, Africa, India, and internationally. The company operates through two segments, Print and Other; and FITTLE. The Print and Other segment designs, develops, and sells document systems, solutions, and services; and IT and software products and services. The FITTLE segment offers financing solutions for direct channel customer purchases; and lease financing to end-users. It also offers workplace solutions comprising desktop monochrome, color, and multifunction printers, and ConnectKey software; digital printing presses and light production devices; and digital services that support workflow automation, personalization and communication software, content management solutions, and digitization services. In addition, the company provides graphic communications, in-plant, and production solutions; FreeFlow, a software solutions for the automation and integration of processing of print job comprising file preparation, final production, and electronic publishing; and IT services, end user computing devices, network infrastructure, and communications technology, as well as technology product support, professional engineering, and commercial robotic process automation. Further, it sells paper products and standalone software, such as CareAR, DocuShare, and XMPie; and invests in startups. The company sells its products through its direct sales force, distributors, independent agents, dealers, value-added resellers, systems integrators, and e-commerce marketplaces. The company was formerly known as Xerox Corporation and changed its name to Xerox Holdings Corporation in August 2019. Xerox Holdings Corporation was founded in 1903 and is headquartered in Norwalk, Connecticut.