Education
About Us
Working with TipRanks
Follow Us
HP (HPQ)
NYSE:HPQ
Top Page
HP
(NYSE:HPQ)61Neutral
Positive Factors
AI PC Growth
The next-generation AI PC is set to be a new growth driver, differentiating its products from competitors and positioning HP for increased AI PC penetration.
Market Share
The company holds a 20.4% market share in global PC shipments and dominates the global hardcopy peripherals market with a 33% market share.
Negative Factors
PC Market Competition
Intense PC market competition may put pressure on its market share and profitability.
HP (HPQ) vs. S&P 500 (SPY)
Market Cap
$28.32B
Dividend Yield3.71%
Average Volume (3M)6.68M
Price to Earnings (P/E)10.8
Beta (1Y)0.89
Revenue Growth1.03%
EPS Growth-18.56%
CountryUS
Employees58,000
SectorTechnology
Sector Strength48
IndustryHardware & Equipment
Share Statistics
EPS (TTM)2.78
Shares Outstanding942,703,000
10 Day Avg. Volume9,054,168
30 Day Avg. Volume6,682,739
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.53
Price to Cash Flow (P/CF)18.90
P/FCF Ratio15.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$36.88Price Target Upside25.91% Upside
Rating ConsensusHold
Number of Analyst Covering12
HP Business Overview & Revenue Model
Company DescriptionHP Inc. was formed following the split of Hewlett-Packard Company in 2015 and is among the world’s top five personal computer manufacturers. The company provides personal computing and other access devices, imaging and printing products, and related technologies, solutions and services to individual consumers, small and medium businesses, and large enterprises.
How the Company Makes MoneyHP Inc. generates revenue primarily through the sale of personal computing devices and printing products. The company's key revenue streams are divided into two main segments: Personal Systems and Printing. The Personal Systems segment includes sales of commercial and consumer PCs, workstations, and other computing devices, which contribute significantly to the company's earnings. The Printing segment encompasses the sale of printers, supplies such as ink and toner, and managed print services. HP also benefits from strategic partnerships and collaborations with other technology companies, which help to expand its market reach and product offerings. Additionally, the company invests in research and development to drive innovation and maintain a competitive edge in the rapidly evolving technology landscape.
HP Financial Statement Overview
Summary
HP demonstrates stable profitability with consistent margins, though revenue growth has been challenged. The balance sheet indicates high leverage, which could pose risks if not managed carefully. Cash flow generation is strong, supporting operations and investments. Overall, while there are strengths in cash flow and profitability, attention is needed on managing debt levels and reversing revenue declines.Income Statement
HP has shown stable gross and net profit margins with a gross profit margin of approximately 21.7% and net profit margin of 5.0% for the TTM. Despite a slight decline in revenue over recent years, the company has maintained consistent EBIT and EBITDA margins. However, the revenue growth rate has been negative, indicating potential challenges in market demand or competition.65
Positive
Balance Sheet
HP's balance sheet reflects a high debt-to-equity ratio with equity being minimal or negative in past periods, indicating high leverage. The equity ratio has been negative, raising concerns about financial stability. However, the company has managed to maintain a reasonable return on equity in the TTM due to positive net income.50
Neutral
Cash Flow
HP has shown strong cash flow performance with positive free cash flow growth in the TTM. The operating cash flow to net income ratio is robust, reflecting efficient cash generation from operations. However, the free cash flow to net income ratio has seen fluctuations, suggesting some volatility in capital expenditures and cash management.70
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 53.84B | 53.56B | 53.72B | 62.98B | 63.49B | 56.64B | Gross Profit |
| 11.69B | 11.82B | 11.51B | 12.34B | 13.42B | 10.44B | EBIT |
| 3.82B | 3.82B | 3.46B | 4.68B | 5.30B | 3.46B | EBITDA |
| 4.62B | 4.72B | 4.46B | 5.45B | 8.60B | 4.26B | Net Income Common Stockholders |
| 2.72B | 2.77B | 3.26B | 3.13B | 6.54B | 2.81B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 3.24B | 3.24B | 3.23B | 3.15B | 4.30B | 4.86B | Total Assets |
| 39.91B | 39.91B | 37.00B | 38.59B | 38.61B | 34.68B | Total Debt |
| 10.90B | 10.90B | 10.74B | 11.01B | 7.49B | 6.22B | Net Debt |
| 7.66B | 7.66B | 7.51B | 7.87B | 3.19B | 1.35B | Total Liabilities |
| 41.23B | 41.23B | 38.07B | 41.51B | 40.26B | 36.91B | Stockholders Equity |
| 2.96B | 2.96B | -1.07B | -2.92B | -1.65B | -2.23B |
| Cash Flow | Free Cash Flow | ||||
| 3.27B | 3.75B | 2.96B | 3.67B | 5.83B | 3.74B | Operating Cash Flow |
| 4.00B | 3.75B | 3.57B | 4.46B | 6.41B | 4.32B | Investing Cash Flow |
| -718.00M | -646.00M | -590.00M | -3.55B | -1.01B | -1.02B | Financing Cash Flow |
| -2.81B | -3.08B | -2.89B | -2.07B | -5.96B | -2.97B |
HP Technical Analysis
Negative
29.29
Price Trends
32.94
Negative
34.60
Negative
34.58
Negative
Market Momentum
-0.53
Positive
23.79
Positive
7.04
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HPQ, the sentiment is Negative. The current price of 29.29 is below the 20-day moving average (MA) of 32.98, below the 50-day MA of 32.94, and below the 200-day MA of 34.58, indicating a bearish trend. The MACD of -0.53 indicates Positive momentum. The RSI at 23.79 is Positive, neither overbought nor oversold. The STOCH value of 7.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HPQ.
HP Risk Analysis
HP disclosed 32 risk factors in its most recent earnings report. HP reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
HP Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $2.89T | 31.30 | 30.64% | 0.81% | 15.04% | 12.38% | |
76 Outperform | $3.54T | 37.51 | 144.03% | 0.53% | 2.61% | -2.14% | |
74 Outperform | $251.67B | 27.72 | 20.18% | 2.52% | -5.34% | -30.57% | |
67 Neutral | $234.79B | 39.40 | 22.06% | 2.67% | 1.45% | -20.56% | |
66 Neutral | $66.01B | 14.74 | -179.12% | 1.86% | 7.99% | ― | |
61 Neutral | $28.32B | 10.79 | 84.33% | 3.71% | 1.03% | -18.56% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% |
* Technology Sector Average
Performance Comparison
HPQ
HP
29.29
0.05
0.17%
AAPL
Apple
235.93
67.61
40.17%
CSCO
Cisco Systems
63.26
15.60
32.73%
IBM
International Business Machines
253.21
63.43
33.42%
MSFT
Microsoft
388.61
-10.43
-2.61%
DELL
Dell Technologies
94.07
-22.68
-19.43%
HP Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -11.59% | Next Earnings Date: May 28, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong start to the fiscal year with positive revenue growth and strategic advancements in AI integration and market share gains. However, challenges remain in the form of weak demand in China and increased commodity costs impacting margins. Despite these challenges, HP's proactive strategies, such as the Future Ready Plan, position the company for continued growth.Highlights
Revenue Growth and Share Gains
HP delivered top-line revenue growth for the third consecutive quarter, up 2% year-over-year, driven by Personal Systems and commercial business. The company gained market share in the PC commercial Windows market.
Acquisition and AI Integration
HP entered into an agreement to acquire strategic assets from Humane, aiming to accelerate AI integration across HP devices. This move is expected to enhance HP's innovation ecosystem and improve product connectivity.
Print Business Milestones
HP achieved a milestone of one million instant paper subscribers with double-digit revenue growth in consumer subscriptions. Additionally, the company maintained its market share in strategic print areas.
Future Ready Plan Progress
HP increased its gross annual run rate savings target from $1.6 billion to $1.9 billion by the end of fiscal year 2025, demonstrating progress in cost reduction strategies.
Strong Performance in Key Growth Areas
Revenue in key growth areas like hybrid systems, advanced compute solutions, and AI PCs increased year-over-year, reflecting HP's strategic focus on these segments.
Lowlights
Weakness in China Market
HP continued to face weak demand and competitive pricing in the Chinese market, particularly affecting the commercial print segment.
Commodity Cost Impact
Increased commodity costs negatively impacted gross margins, although HP expects these to improve in the latter half of the fiscal year with cost reduction initiatives.
Negative Free Cash Flow in Q2
HP anticipates negative free cash flow in the second quarter due to inventory strategies and timing impacts on cash conversion cycles, although the full-year outlook remains unaffected.
Company Guidance
During the first quarter of fiscal year 2025, HP Inc. reported a 2% year-over-year increase in revenue, marking the third consecutive quarter of revenue growth. This was primarily driven by a 5% growth in Personal Systems revenue, with commercial revenue up 10% year-over-year, offsetting a 7% decline in consumer revenue. The company reported non-GAAP earnings per share of $0.74, slightly above the midpoint of their guidance, with operating profit margins for both Print and Personal Systems meeting expectations. Despite a 1% decline in print revenue in constant currency, HP achieved strong unit growth and market share gains in home printing. The company anticipates delivering $1.9 billion in gross annual run-rate structural savings by the end of fiscal year 2025, up from their previous target of $1.6 billion. This is expected to help offset macroeconomic and geopolitical uncertainties and support strategic investments, including the acquisition of strategic assets from Humane to advance AI capabilities. HP also maintained confidence in its full-year outlook, projecting non-GAAP diluted EPS in the range of $3.45 to $3.75 and free cash flow between $3.2 billion and $3.6 billion.HP Corporate Events
Executive/Board Changes
HP Appoints Gianluca Pettiti to Board of Directors
Neutral
Feb 21, 2025
On February 21, 2025, HP Inc. expanded its Board of Directors by appointing Gianluca Pettiti, an executive from Thermo Fisher Scientific, as an independent director. This move necessitated an amendment to the company’s bylaws, increasing the number of authorized directorships from 14 to 15. Mr. Pettiti will serve on the Finance, Investment and Technology Committee and the HR and Compensation Committee, receiving compensation consistent with other non-employee directors.
Executive/Board Changes
HP Appoints Songyee Yoon to Board, Expands Directorships
Neutral
Feb 7, 2025
On February 4, 2025, HP Inc.’s Board of Directors expanded its size and elected Songyee Yoon as a new director, effective February 6, 2025. Ms. Yoon, a Managing Partner at Principal Venture Partners, L.P., will also serve on the Audit Committee and Finance, Investment and Technology Committee, receiving compensation consistent with other non-employee directors. Additionally, the Board amended the company’s bylaws to increase the number of authorized directorships from 13 to 14 to accommodate her appointment.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.