HEWLETT PACKARD ENTERPRISE (HPE) Stock Fundamental Analysis
USA - NYSE:HPE - US42824C1099 - Common Stock
23.4 USD
-0.31 (-1.31%)
23.4025 USD
+0 (+0.01%)
We assign a fundamental rating of 4 out of 10 to HPE. HPE was compared to 35 industry peers in the Technology Hardware, Storage & Peripherals industry. HPE has a medium profitability rating, but doesn't score so well on its financial health evaluation. HPE is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
HPE had positive earnings in the past year.
HPE had a positive operating cash flow in the past year.
HPE had positive earnings in 4 of the past 5 years.
HPE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
HPE has a better Return On Assets (1.47%) than 65.71% of its industry peers.
The Return On Equity of HPE (4.66%) is better than 77.14% of its industry peers.
Looking at the Return On Invested Capital, with a value of 3.50%, HPE is in the better half of the industry, outperforming 65.71% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for HPE is significantly below the industry average of 16.54%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.47% | ||
| ROE | 4.66% | ||
| ROIC | 3.5% |
ROA(3y)2.88%
ROA(5y)2.8%
ROE(3y)8.07%
ROE(5y)7.88%
ROIC(3y)5.52%
ROIC(5y)5.09%
1.3 Margins
With a decent Profit Margin value of 3.43%, HPE is doing good in the industry, outperforming 68.57% of the companies in the same industry.
In the last couple of years the Profit Margin of HPE has grown nicely.
Looking at the Operating Margin, with a value of 6.15%, HPE is in the better half of the industry, outperforming 62.86% of the companies in the same industry.
In the last couple of years the Operating Margin of HPE has remained more or less at the same level.
The Gross Margin of HPE (29.45%) is comparable to the rest of the industry.
HPE's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.15% | ||
| PM (TTM) | 3.43% | ||
| GM | 29.45% |
OM growth 3Y2.85%
OM growth 5Y-0.53%
PM growth 3Y-11.75%
PM growth 5Y18.68%
GM growth 3Y-0.96%
GM growth 5Y0.13%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HPE is destroying value.
The number of shares outstanding for HPE has been increased compared to 1 year ago.
The number of shares outstanding for HPE has been increased compared to 5 years ago.
HPE has a worse debt/assets ratio than last year.
2.2 Solvency
HPE has an Altman-Z score of 0.80. This is a bad value and indicates that HPE is not financially healthy and even has some risk of bankruptcy.
HPE has a Altman-Z score (0.80) which is in line with its industry peers.
The Debt to FCF ratio of HPE is 105.12, which is on the high side as it means it would take HPE, 105.12 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 105.12, HPE is in line with its industry, outperforming 48.57% of the companies in the same industry.
HPE has a Debt/Equity ratio of 0.76. This is a neutral value indicating HPE is somewhat dependend on debt financing.
The Debt to Equity ratio of HPE (0.76) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 105.12 | ||
| Altman-Z | 0.8 |
ROIC/WACC0.47
WACC7.38%
2.3 Liquidity
A Current Ratio of 0.95 indicates that HPE may have some problems paying its short term obligations.
With a Current ratio value of 0.95, HPE is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
A Quick Ratio of 0.69 indicates that HPE may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.69, HPE is doing worse than 62.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.95 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
HPE shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.56%.
Measured over the past 5 years, HPE shows a small growth in Earnings Per Share. The EPS has been growing by 2.15% on average per year.
Looking at the last year, HPE shows a quite strong growth in Revenue. The Revenue has grown by 13.97% in the last year.
The Revenue has been growing slightly by 0.67% on average over the past years.
EPS 1Y (TTM)-1.56%
EPS 3Y0.17%
EPS 5Y2.15%
EPS Q2Q%-12%
Revenue 1Y (TTM)13.97%
Revenue growth 3Y2.74%
Revenue growth 5Y0.67%
Sales Q2Q%18.5%
3.2 Future
The Earnings Per Share is expected to grow by 10.57% on average over the next years. This is quite good.
HPE is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.76% yearly.
EPS Next Y-3.24%
EPS Next 2Y10.65%
EPS Next 3Y11.05%
EPS Next 5Y10.57%
Revenue Next Year15.43%
Revenue Next 2Y16.63%
Revenue Next 3Y12.15%
Revenue Next 5Y9.76%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.38, which indicates a correct valuation of HPE.
HPE's Price/Earnings ratio is rather cheap when compared to the industry. HPE is cheaper than 91.43% of the companies in the same industry.
HPE's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.67.
A Price/Forward Earnings ratio of 9.65 indicates a reasonable valuation of HPE.
Based on the Price/Forward Earnings ratio, HPE is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 31.86, HPE is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.38 | ||
| Fwd PE | 9.65 |
4.2 Price Multiples
HPE's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. HPE is cheaper than 82.86% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HPE is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 137.22 | ||
| EV/EBITDA | 10.72 |
4.3 Compensation for Growth
The decent profitability rating of HPE may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)5.75
EPS Next 2Y10.65%
EPS Next 3Y11.05%
5. Dividend
5.1 Amount
HPE has a Yearly Dividend Yield of 2.13%.
HPE's Dividend Yield is rather good when compared to the industry average which is at 1.85. HPE pays more dividend than 91.43% of the companies in the same industry.
HPE's Dividend Yield is comparable with the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.13% |
5.2 History
The dividend of HPE has a limited annual growth rate of 3.20%.
HPE has been paying a dividend for at least 10 years, so it has a reliable track record.
HPE has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)3.2%
Div Incr Years2
Div Non Decr Years9
5.3 Sustainability
HPE pays out 67.34% of its income as dividend. This is not a sustainable payout ratio.
HPE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP67.34%
EPS Next 2Y10.65%
EPS Next 3Y11.05%
23.4
-0.31 (-1.31%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners88.19%
Inst Owner Change-1.5%
Ins Owners0.36%
Ins Owner Change-7.96%
Market Cap30.88B
Revenue(TTM)33.08B
Net Income(TTM)1.14B
Analysts76
Price Target26.87 (14.83%)
Short Float %3.36%
Short Ratio1.54
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.13% |
Yearly Dividend0.52
Dividend Growth(5Y)3.2%
DP67.34%
Div Incr Years2
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.57%
Min EPS beat(2)1.17%
Max EPS beat(2)15.97%
EPS beat(4)3
Avg EPS beat(4)4.54%
Min EPS beat(4)-1.9%
Max EPS beat(4)15.97%
EPS beat(8)7
Avg EPS beat(8)4.78%
EPS beat(12)11
Avg EPS beat(12)5.45%
EPS beat(16)13
Avg EPS beat(16)5.08%
Revenue beat(2)2
Avg Revenue beat(2)3.74%
Min Revenue beat(2)1.42%
Max Revenue beat(2)6.06%
Revenue beat(4)3
Avg Revenue beat(4)2.11%
Min Revenue beat(4)-0.51%
Max Revenue beat(4)6.06%
Revenue beat(8)4
Avg Revenue beat(8)0.67%
Revenue beat(12)6
Avg Revenue beat(12)0.67%
Revenue beat(16)6
Avg Revenue beat(16)0.1%
PT rev (1m)5.84%
PT rev (3m)20.08%
EPS NQ rev (1m)-0.35%
EPS NQ rev (3m)4.02%
EPS NY rev (1m)-0.11%
EPS NY rev (3m)6.12%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)6.65%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)3.11%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.38 | ||
| Fwd PE | 9.65 | ||
| P/S | 0.93 | ||
| P/FCF | 137.22 | ||
| P/OCF | 12.43 | ||
| P/B | 1.27 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.72 |
EPS(TTM)1.89
EY8.08%
EPS(NY)2.42
Fwd EY10.36%
FCF(TTM)0.17
FCFY0.73%
OCF(TTM)1.88
OCFY8.05%
SpS25.07
BVpS18.49
TBVpS-4.55
PEG (NY)N/A
PEG (5Y)5.75
Graham Number28.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.47% | ||
| ROE | 4.66% | ||
| ROCE | 4.07% | ||
| ROIC | 3.5% | ||
| ROICexc | 3.84% | ||
| ROICexgc | 10.81% | ||
| OM | 6.15% | ||
| PM (TTM) | 3.43% | ||
| GM | 29.45% | ||
| FCFM | 0.68% |
ROA(3y)2.88%
ROA(5y)2.8%
ROE(3y)8.07%
ROE(5y)7.88%
ROIC(3y)5.52%
ROIC(5y)5.09%
ROICexc(3y)6.82%
ROICexc(5y)6.08%
ROICexgc(3y)16.7%
ROICexgc(5y)14.78%
ROCE(3y)6.33%
ROCE(5y)5.84%
ROICexgc growth 3Y10.99%
ROICexgc growth 5Y-3.59%
ROICexc growth 3Y8.67%
ROICexc growth 5Y-0.74%
OM growth 3Y2.85%
OM growth 5Y-0.53%
PM growth 3Y-11.75%
PM growth 5Y18.68%
GM growth 3Y-0.96%
GM growth 5Y0.13%
F-Score4
Asset Turnover0.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.76 | ||
| Debt/FCF | 105.12 | ||
| Debt/EBITDA | 4.1 | ||
| Cap/Depr | 90.36% | ||
| Cap/Sales | 6.83% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 54.77% | ||
| Profit Quality | 19.81% | ||
| Current Ratio | 0.95 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 0.8 |
F-Score4
WACC7.38%
ROIC/WACC0.47
Cap/Depr(3y)108.77%
Cap/Depr(5y)102.69%
Cap/Sales(3y)9.51%
Cap/Sales(5y)9.27%
Profit Quality(3y)108.59%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-1.56%
EPS 3Y0.17%
EPS 5Y2.15%
EPS Q2Q%-12%
EPS Next Y-3.24%
EPS Next 2Y10.65%
EPS Next 3Y11.05%
EPS Next 5Y10.57%
Revenue 1Y (TTM)13.97%
Revenue growth 3Y2.74%
Revenue growth 5Y0.67%
Sales Q2Q%18.5%
Revenue Next Year15.43%
Revenue Next 2Y16.63%
Revenue Next 3Y12.15%
Revenue Next 5Y9.76%
EBIT growth 1Y-10.43%
EBIT growth 3Y5.66%
EBIT growth 5Y0.14%
EBIT Next Year79.02%
EBIT Next 3Y33.97%
EBIT Next 5Y17.11%
FCF growth 1Y-84.67%
FCF growth 3Y-16.32%
FCF growth 5Y11.59%
OCF growth 1Y-46.25%
OCF growth 3Y-9.57%
OCF growth 5Y1.66%
HEWLETT PACKARD ENTERPRISE / HPE FAQ
What is the fundamental rating for HPE stock?
ChartMill assigns a fundamental rating of 4 / 10 to HPE.
What is the valuation status for HPE stock?
ChartMill assigns a valuation rating of 6 / 10 to HEWLETT PACKARD ENTERPRISE (HPE). This can be considered as Fairly Valued.
What is the profitability of HPE stock?
HEWLETT PACKARD ENTERPRISE (HPE) has a profitability rating of 6 / 10.
What are the PE and PB ratios of HEWLETT PACKARD ENTERPRISE (HPE) stock?
The Price/Earnings (PE) ratio for HEWLETT PACKARD ENTERPRISE (HPE) is 12.38 and the Price/Book (PB) ratio is 1.27.
What is the financial health of HEWLETT PACKARD ENTERPRISE (HPE) stock?
The financial health rating of HEWLETT PACKARD ENTERPRISE (HPE) is 1 / 10.