Analyst Upgrade Pushes Lexmark Shares Higher

SEATTLE (AP) — Shares of printing products and services company Lexmark International Inc. jumped Friday after an analyst said the stock is underpriced.

Barclays Capital analyst Ben A. Reitzes upgraded Lexington, Ky.-based Lexmark to "Equal weight" from "Underweight."

In a research note, the analyst wrote that he still expects the number of Lexmark's regular customers to decline and sees the potential for supplies sales to fall. But shares have significantly underperformed the market so far this year, he wrote.

Lexmark's stock jumped $1.10, or 7.2 percent, to $16.33 in midday trading.

"We believe investors know about the issues in printing and emerging threat that HP (Hewlett-Packard Co.) may be about to get more price aggressive," Reitzes wrote.

The analyst held his earnings estimate for the second quarter at 53 cents per share, citing the ongoing economic downturn. On average, analysts are looking for Lexmark to earn 60 cents per share, according to a Thomson Reuters survey.