NEW YORK (TheStreet) -- Lexmark International (LXK) was rising 7.6% to $37.58 on Tuesday after the printer maker announced better-than-expected quarterly results thanks to higher revenues from its managed print services and software sectors.
Lexmark's revenue from managed print services, which lets companies outsource their printing jobs to another service provider, rose 22% in the quarter that ended on Dec. 31, while revenue from the perceptive software business, which creates scanning software, jumped 70% to $72 million. Total revenue rose 4% to $1.01 billion, while net income rose to $94 million, or $1.48 a share, from $26.3 million, or 40 cents a share, from the same period one year earlier.
Lexmark earned $1.18 per share, excluding items, while analysts had expected an EPS of $1.09 on revenue of $929.5 million.
The printer maker also projected first-quarter adjusted earnings of 80 to 90 cents a share, along with a revenue decrease of 3% to 5% because of the company's departure from the inkjet printer business. Analysts polled by Thomson Reuters I/B/E/S expected earnings of 85 cents per share.
TheStreet Ratings team rates LEXMARK INTL INC as a "buy" with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate LEXMARK INTL INC (LXK) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations, solid stock price performance, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."