Pitney Bowes Appoints Vice President of Global Financial Services

Pitney Bowes (PBI) has a market cap of $2.8 billion. It rose 1.4% to close at $14.86 per share on November 9, 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were 1.9%, -14.6%, and -28.0%, respectively, on the same day. PBI is trading 10.1% below its 20-day moving average, 14.6% below its 50-day moving average, and 19.0% below its 200-day moving average.

The ALPS Sector Dividend Dogs ETF (SDOG) invests 2.1% of its holdings in Pitney Bowes. The ETF tracks an equal-weighted index of the five highest-yielding S&P 500 securities in each sector. The YTD price movement of SDOG was 15.4% on November 9. The market caps of Pitney Bowes’s competitors are as follows:

• Lexmark International (LXK) — $2.5 billion
• Xerox (XRX) — $9.8 billion
• Canon (CAJ) — $38.2 billion

Chris Johnson has been appointed vice president of GFS (Global Financial Services), effective immediately, and will report to the company’s executive vice president, chief operating officer, and chief financial officer, Michael Monahan.

The company stated that “In this role Mr. Johnson will be responsible for leading all aspects of the GFS Business Strategy which includes strategic analysis in identified markets, assessing current capabilities against future opportunities, determining priorities for investment, organizational development and business culture.”

Pitney Bowes reported total revenue of $839.0 million in 3Q16, a fall of 3.5% from the total revenue of $869.5 million in 3Q15. Revenue from SMB (Small & Medium Business) Solutions and Digital Commerce Solutions fell 7.0% and 0.52%, respectively, and revenue from Enterprise Business Solutions rose 0.92% between 3Q15 and 3Q16.

Its net income and EPS (earnings per share) fell to $65.5 million and $0.35, respectively, in 3Q16, compared with $89.3 million and $0.44, respectively, in 3Q15. It reported adjusted EPS of $0.44 in 3Q16, a rise of 2.3% over 3Q15.

Pitney Bowes’s cash and cash equivalents and inventories rose 52.5% and 22.5%, respectively, between 4Q15 and 3Q16. Its current ratio rose to 1.2x in 3Q16, compared with 1.0x in 4Q15.

Pitney Bowes has made the following projections for fiscal 2016 and fiscal 2H16:

• revenue growth of -1% to -3% on a constant-currency basis.
• adjusted EPS of $1.75–$1.82
• free cash flow of $400 million–$450 million

Next, we’ll discuss BorgWarner (BWA).