Consumer Electronics

Kodak's New Printer Product Will Be Stillborn

Eastman Kodak (EK) is coming out with a new printer. On paper, it looks unbelievable. The ink stays vibrant for 100 years instead of the normal decade or so. Ink cartridges are cheap. The thing only costs about $200.

The product is aimed at Hewlett-Packard’s (HPQ) massive printer business which is the bulk of that company’s operating profits. It will also compete with printer “also ran” Lexmark (LXK).

But, the market tells the story. Lexmark, a much weaker player than HP, is down 2.4% to $61.15 at 10:20 AM Eastern. Hewlett-Packard is down a little over 1% to $42.31, but its 52-week high is $43.72.

Eastman Kodak is off .4% to $26.17. Over the last two years EK is down over 20% while the Dow is up close to 18%.

The problem is that, no matter how good the product, no one on Wall St. believes in Kodak or its management. The company has fumbled the ball too many times. Kodak has not been able to replace its falling film revenue. It takes charges almost every quarter, and, as Irina Logovinsky, CPA of Morningstar points out: “Consumers may not be printing as many digital photos as expected, a trend that could undermine Kodak’s efforts in digital reproduction”.

Good product from a loser company.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.