) to equal-weight from underweight.
Analyst Caroline Sabbagha says the copier giant provided earnings per share targets of 67 cents to 72 cents in 2004, and 90 cents to $1.00 in 2005, vs. her estimates of 72 cents in 2004 and 85 cents to 90 cents in 2005 (normalized). Sabbagha thinks 2004 and 2005 guidance is now more realistic. She notes managment maintained operating cash-flow expectations of $1.5 billion annually, but more strongly, it emphasized debt paydown and the potential acquistions as the uses of cash.
Sabbagha says Xerox expects overall industry revenue growth to be flat in the long term, but for the company to drive its revenue growth via color products and commercial digital printing. She upped the target to $11.