HP INC (HPQ) Stock Fundamental Analysis
USA - NYSE:HPQ - US40434L1052 - Common Stock
27.97 USD
-0.37 (-1.31%)
27.97 USD
0 (0%)
Overall HPQ gets a fundamental rating of 5 out of 10. We evaluated HPQ against 33 industry peers in the Technology Hardware, Storage & Peripherals industry. While HPQ belongs to the best of the industry regarding profitability, there are concerns on its financial health. HPQ has a bad growth rate and is valued cheaply. Finally HPQ also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
HPQ had positive earnings in the past year.
In the past year HPQ had a positive cash flow from operations.
Each year in the past 5 years HPQ has been profitable.
Each year in the past 5 years HPQ had a positive operating cash flow.
1.2 Ratios
HPQ's Return On Assets of 6.62% is fine compared to the rest of the industry. HPQ outperforms 78.79% of its industry peers.
HPQ has a better Return On Invested Capital (25.92%) than 93.94% of its industry peers.
HPQ had an Average Return On Invested Capital over the past 3 years of 31.68%. This is significantly above the industry average of 14.98%.
The last Return On Invested Capital (25.92%) for HPQ is well below the 3 year average (31.68%), which needs to be investigated, but indicates that HPQ had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.62% | ||
| ROE | N/A | ||
| ROIC | 25.92% |
ROA(3y)7.97%
ROA(5y)9.81%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)31.68%
ROIC(5y)36.51%
1.3 Margins
HPQ has a Profit Margin of 4.83%. This is in the better half of the industry: HPQ outperforms 75.76% of its industry peers.
In the last couple of years the Profit Margin of HPQ has remained more or less at the same level.
With a decent Operating Margin value of 6.71%, HPQ is doing good in the industry, outperforming 63.64% of the companies in the same industry.
HPQ's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 20.89%, HPQ is not doing good in the industry: 69.70% of the companies in the same industry are doing better.
HPQ's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 6.71% | ||
| PM (TTM) | 4.83% | ||
| GM | 20.89% |
OM growth 3Y-4.29%
OM growth 5Y1.94%
PM growth 3Y-20.49%
PM growth 5Y-0.69%
GM growth 3Y1.46%
GM growth 5Y3.02%
2. Health
2.1 Basic Checks
HPQ has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for HPQ has been reduced compared to 1 year ago.
The number of shares outstanding for HPQ has been reduced compared to 5 years ago.
Compared to 1 year ago, HPQ has an improved debt to assets ratio.
2.2 Solvency
HPQ has a debt to FCF ratio of 3.38. This is a good value and a sign of high solvency as HPQ would need 3.38 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.38, HPQ is doing good in the industry, outperforming 72.73% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.38 | ||
| Altman-Z | N/A |
ROIC/WACC3.49
WACC7.42%
2.3 Liquidity
A Current Ratio of 0.74 indicates that HPQ may have some problems paying its short term obligations.
HPQ's Current ratio of 0.74 is on the low side compared to the rest of the industry. HPQ is outperformed by 90.91% of its industry peers.
A Quick Ratio of 0.44 indicates that HPQ may have some problems paying its short term obligations.
HPQ has a Quick ratio of 0.44. This is amonst the worse of the industry: HPQ underperforms 87.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
HPQ shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.85%.
HPQ shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.74% yearly.
The Revenue has been growing slightly by 2.61% in the past year.
The Revenue has been decreasing by -1.84% on average over the past years.
EPS 1Y (TTM)-6.85%
EPS 3Y-2.52%
EPS 5Y8.74%
EPS Q2Q%-9.64%
Revenue 1Y (TTM)2.61%
Revenue growth 3Y-5.5%
Revenue growth 5Y-1.84%
Sales Q2Q%3.05%
3.2 Future
Based on estimates for the next years, HPQ will show a small growth in Earnings Per Share. The EPS will grow by 2.13% on average per year.
HPQ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.32% yearly.
EPS Next Y-6.49%
EPS Next 2Y0.17%
EPS Next 3Y2.43%
EPS Next 5Y2.13%
Revenue Next Year2.31%
Revenue Next 2Y1.88%
Revenue Next 3Y1.83%
Revenue Next 5Y1.32%
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 decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 8.94 indicates a reasonable valuation of HPQ.
Based on the Price/Earnings ratio, HPQ is valued cheaply inside the industry as 96.97% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of HPQ to the average of the S&P500 Index (27.30), we can say HPQ is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 8.22, the valuation of HPQ can be described as reasonable.
Based on the Price/Forward Earnings ratio, HPQ is valued cheaper than 84.85% of the companies in the same industry.
HPQ is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.73, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.94 | ||
| Fwd PE | 8.22 |
4.2 Price Multiples
HPQ's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. HPQ is cheaper than 93.94% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, HPQ is valued cheaply inside the industry as 84.85% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.24 | ||
| EV/EBITDA | 7.27 |
4.3 Compensation for Growth
HPQ has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.02
EPS Next 2Y0.17%
EPS Next 3Y2.43%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.08%, HPQ is a good candidate for dividend investing.
HPQ's Dividend Yield is rather good when compared to the industry average which is at 1.85. HPQ pays more dividend than 100.00% of the companies in the same industry.
HPQ's Dividend Yield is rather good when compared to the S&P500 average which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.08% |
5.2 History
The dividend of HPQ is nicely growing with an annual growth rate of 11.65%!
HPQ has paid a dividend for at least 10 years, which is a reliable track record.
HPQ has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.65%
Div Incr Years14
Div Non Decr Years34
5.3 Sustainability
40.95% of the earnings are spent on dividend by HPQ. This is a bit on the high side, but may be sustainable.
HPQ's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP40.95%
EPS Next 2Y0.17%
EPS Next 3Y2.43%
27.97
-0.37 (-1.31%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners82.52%
Inst Owner Change-0.49%
Ins Owners0.2%
Ins Owner Change2.25%
Market Cap26.14B
Analysts66.67
Price Target28.37 (1.43%)
Short Float %3.4%
Short Ratio3.77
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.08% |
Yearly Dividend1.12
Dividend Growth(5Y)11.65%
DP40.95%
Div Incr Years14
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-6.84%
Min EPS beat(2)-12.57%
Max EPS beat(2)-1.12%
EPS beat(4)0
Avg EPS beat(4)-4.04%
Min EPS beat(4)-12.57%
Max EPS beat(4)-0.96%
EPS beat(8)1
Avg EPS beat(8)-2.81%
EPS beat(12)3
Avg EPS beat(12)-1.67%
EPS beat(16)6
Avg EPS beat(16)-0.46%
Revenue beat(2)1
Avg Revenue beat(2)0.15%
Min Revenue beat(2)-0.41%
Max Revenue beat(2)0.72%
Revenue beat(4)2
Avg Revenue beat(4)-0.04%
Min Revenue beat(4)-0.5%
Max Revenue beat(4)0.72%
Revenue beat(8)4
Avg Revenue beat(8)-0.55%
Revenue beat(12)4
Avg Revenue beat(12)-1.07%
Revenue beat(16)7
Avg Revenue beat(16)-0.68%
PT rev (1m)2.38%
PT rev (3m)-1%
EPS NQ rev (1m)0.41%
EPS NQ rev (3m)-10.81%
EPS NY rev (1m)0.75%
EPS NY rev (3m)-9.39%
Revenue NQ rev (1m)1.41%
Revenue NQ rev (3m)-0.86%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.94 | ||
| Fwd PE | 8.22 | ||
| P/S | 0.48 | ||
| P/FCF | 9.24 | ||
| P/OCF | 7.11 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.27 |
EPS(TTM)3.13
EY11.19%
EPS(NY)3.4
Fwd EY12.16%
FCF(TTM)3.03
FCFY10.82%
OCF(TTM)3.93
OCFY14.07%
SpS58.25
BVpS-0.96
TBVpS-10.24
PEG (NY)N/A
PEG (5Y)1.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.62% | ||
| ROE | N/A | ||
| ROCE | 30.63% | ||
| ROIC | 25.92% | ||
| ROICexc | 34.09% | ||
| ROICexgc | 773.03% | ||
| OM | 6.71% | ||
| PM (TTM) | 4.83% | ||
| GM | 20.89% | ||
| FCFM | 5.2% |
ROA(3y)7.97%
ROA(5y)9.81%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)31.68%
ROIC(5y)36.51%
ROICexc(3y)43.22%
ROICexc(5y)62.78%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)37.59%
ROCE(5y)43.81%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-19.53%
ROICexc growth 5Y-14.33%
OM growth 3Y-4.29%
OM growth 5Y1.94%
PM growth 3Y-20.49%
PM growth 5Y-0.69%
GM growth 3Y1.46%
GM growth 5Y3.02%
F-Score5
Asset Turnover1.37
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.38 | ||
| Debt/EBITDA | 1.91 | ||
| Cap/Depr | 93.12% | ||
| Cap/Sales | 1.56% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.56% | ||
| Profit Quality | 107.69% | ||
| Current Ratio | 0.74 | ||
| Quick Ratio | 0.44 | ||
| Altman-Z | N/A |
F-Score5
WACC7.42%
ROIC/WACC3.49
Cap/Depr(3y)81.46%
Cap/Depr(5y)78.41%
Cap/Sales(3y)1.17%
Cap/Sales(5y)1.09%
Profit Quality(3y)107.26%
Profit Quality(5y)108.45%
High Growth Momentum
Growth
EPS 1Y (TTM)-6.85%
EPS 3Y-2.52%
EPS 5Y8.74%
EPS Q2Q%-9.64%
EPS Next Y-6.49%
EPS Next 2Y0.17%
EPS Next 3Y2.43%
EPS Next 5Y2.13%
Revenue 1Y (TTM)2.61%
Revenue growth 3Y-5.5%
Revenue growth 5Y-1.84%
Sales Q2Q%3.05%
Revenue Next Year2.31%
Revenue Next 2Y1.88%
Revenue Next 3Y1.83%
Revenue Next 5Y1.32%
EBIT growth 1Y-13.36%
EBIT growth 3Y-9.55%
EBIT growth 5Y0.07%
EBIT Next Year9.32%
EBIT Next 3Y3.63%
EBIT Next 5Y0.31%
FCF growth 1Y-1.86%
FCF growth 3Y-18.48%
FCF growth 5Y-4.54%
OCF growth 1Y5.6%
OCF growth 3Y-16.37%
OCF growth 5Y-4.23%