HP INC (1HPQ.MI) Stock Fundamental Analysis
BIT:1HPQ - Borsa Italiana Milan - US40434L1052 - Common Stock - Currency: EUR
Taking everything into account, 1HPQ scores 5 out of 10 in our fundamental rating. 1HPQ was compared to 30 industry peers in the Technology Hardware, Storage & Peripherals industry. While 1HPQ belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. 1HPQ has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year 1HPQ was profitable.
1HPQ had a positive operating cash flow in the past year.
In the past 5 years 1HPQ has always been profitable.
1HPQ had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of 1HPQ (7.47%) is better than 85.19% of its industry peers.
1HPQ's Return On Invested Capital of 27.71% is amongst the best of the industry. 1HPQ outperforms 85.19% of its industry peers.
1HPQ had an Average Return On Invested Capital over the past 3 years of 31.74%. This is significantly above the industry average of 16.47%.
The last Return On Invested Capital (27.71%) for 1HPQ is well below the 3 year average (31.74%), which needs to be investigated, but indicates that 1HPQ had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | N/A | ||
| ROIC | 27.71% |
ROA(3y)11.27%
ROA(5y)10.28%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)31.74%
ROIC(5y)33.13%
1.3 Margins
1HPQ has a Profit Margin of 5.33%. This is in the better half of the industry: 1HPQ outperforms 70.37% of its industry peers.
In the last couple of years the Profit Margin of 1HPQ has declined.
With a decent Operating Margin value of 7.95%, 1HPQ is doing good in the industry, outperforming 66.67% of the companies in the same industry.
In the last couple of years the Operating Margin of 1HPQ has grown nicely.
1HPQ has a Gross Margin (22.13%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of 1HPQ has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.95% | ||
| PM (TTM) | 5.33% | ||
| GM | 22.13% |
OM growth 3Y4.16%
OM growth 5Y2.38%
PM growth 3Y6.55%
PM growth 5Y-7.79%
GM growth 3Y5.15%
GM growth 5Y3.26%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 1HPQ is creating value.
Compared to 1 year ago, 1HPQ has more shares outstanding
The number of shares outstanding for 1HPQ has been reduced compared to 5 years ago.
1HPQ has a better debt/assets ratio than last year.
2.2 Solvency
1HPQ has an Altman-Z score of 1.91. This is not the best score and indicates that 1HPQ is in the grey zone with still only limited risk for bankruptcy at the moment.
1HPQ has a Altman-Z score (1.91) which is in line with its industry peers.
1HPQ has a debt to FCF ratio of 2.74. This is a good value and a sign of high solvency as 1HPQ would need 2.74 years to pay back of all of its debts.
The Debt to FCF ratio of 1HPQ (2.74) is better than 77.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.74 | ||
| Altman-Z | 1.91 |
ROIC/WACC2.63
WACC10.53%
2.3 Liquidity
A Current Ratio of 0.71 indicates that 1HPQ may have some problems paying its short term obligations.
1HPQ has a Current ratio of 0.71. This is amonst the worse of the industry: 1HPQ underperforms 92.59% of its industry peers.
1HPQ has a Quick Ratio of 0.71. This is a bad value and indicates that 1HPQ is not financially healthy enough and could expect problems in meeting its short term obligations.
1HPQ has a Quick ratio of 0.43. This is amonst the worse of the industry: 1HPQ underperforms 92.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.43 |
3. Growth
3.1 Past
1HPQ shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.07%.
The Earnings Per Share has been growing by 10.38% on average over the past years. This is quite good.
The Revenue has decreased by -2.39% in the past year.
Measured over the past years, 1HPQ shows a decrease in Revenue. The Revenue has been decreasing by -1.68% on average per year.
EPS 1Y (TTM)3.07%
EPS 3Y13.4%
EPS 5Y10.38%
EPS Q2Q%-3.49%
Revenue 1Y (TTM)-2.39%
Revenue growth 3Y-1.75%
Revenue growth 5Y-1.68%
Sales Q2Q%2.45%
3.2 Future
1HPQ is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.83% yearly.
1HPQ is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.84% yearly.
EPS Next Y3.27%
EPS Next 2Y4.88%
EPS Next 3Y5.87%
EPS Next 5Y5.83%
Revenue Next Year-0.6%
Revenue Next 2Y1.37%
Revenue Next 3Y1.96%
Revenue Next 5Y0.84%
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.
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 9.83, which indicates a very decent valuation of 1HPQ.
88.89% of the companies in the same industry are more expensive than 1HPQ, based on the Price/Earnings ratio.
1HPQ's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.47.
The Price/Forward Earnings ratio is 9.07, which indicates a very decent valuation of 1HPQ.
The rest of the industry has a similar Price/Forward Earnings ratio as 1HPQ.
When comparing the Price/Forward Earnings ratio of 1HPQ to the average of the S&P500 Index (92.74), we can say 1HPQ is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.83 | ||
| Fwd PE | 9.07 |
4.2 Price Multiples
1HPQ's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, 1HPQ is valued cheaper than 85.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.06 | ||
| EV/EBITDA | 7.59 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1HPQ does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of 1HPQ may justify a higher PE ratio.
PEG (NY)3.01
PEG (5Y)0.95
EPS Next 2Y4.88%
EPS Next 3Y5.87%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.91%, 1HPQ has a reasonable but not impressive dividend return.
1HPQ's Dividend Yield is rather good when compared to the industry average which is at 2.05. 1HPQ pays more dividend than 88.89% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, 1HPQ pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.91% |
5.2 History
On average, the dividend of 1HPQ grows each year by 13.46%, which is quite nice.
Dividend Growth(5Y)13.46%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
37.71% of the earnings are spent on dividend by 1HPQ. This is a low number and sustainable payout ratio.
The dividend of 1HPQ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP37.71%
EPS Next 2Y4.88%
EPS Next 3Y5.87%
HP INC
BIT:1HPQ (1/31/2025, 7:00:00 PM)
31.945
-2.93 (-8.4%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst OwnersN/A
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap30.79B
Analysts68.57
Price Target34.11 (6.78%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.91% |
Yearly Dividend1.05
Dividend Growth(5Y)13.46%
DP37.71%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-2.2%
Min EPS beat(2)-4.43%
Max EPS beat(2)0.02%
EPS beat(4)1
Avg EPS beat(4)-1.59%
Min EPS beat(4)-4.43%
Max EPS beat(4)0.02%
EPS beat(8)3
Avg EPS beat(8)-0.48%
EPS beat(12)6
Avg EPS beat(12)0.73%
EPS beat(16)10
Avg EPS beat(16)4.4%
Revenue beat(2)2
Avg Revenue beat(2)0.33%
Min Revenue beat(2)0.07%
Max Revenue beat(2)0.59%
Revenue beat(4)2
Avg Revenue beat(4)-1.07%
Min Revenue beat(4)-3.75%
Max Revenue beat(4)0.59%
Revenue beat(8)2
Avg Revenue beat(8)-1.59%
Revenue beat(12)5
Avg Revenue beat(12)-0.88%
Revenue beat(16)8
Avg Revenue beat(16)-0.29%
PT rev (1m)3.15%
PT rev (3m)3.15%
EPS NQ rev (1m)-2.79%
EPS NQ rev (3m)-2.79%
EPS NY rev (1m)-1.84%
EPS NY rev (3m)-1.84%
Revenue NQ rev (1m)-2.19%
Revenue NQ rev (3m)-2.19%
Revenue NY rev (1m)-0.27%
Revenue NY rev (3m)-0.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.83 | ||
| Fwd PE | 9.07 | ||
| P/S | 0.6 | ||
| P/FCF | 9.06 | ||
| P/OCF | 7.76 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.59 |
EPS(TTM)3.25
EY10.17%
EPS(NY)3.52
Fwd EY11.03%
FCF(TTM)3.53
FCFY11.04%
OCF(TTM)4.12
OCFY12.89%
SpS53.53
BVpS-1.4
TBVpS-11.41
PEG (NY)3.01
PEG (5Y)0.95
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.47% | ||
| ROE | N/A | ||
| ROCE | 38.47% | ||
| ROIC | 27.71% | ||
| ROICexc | 37.44% | ||
| ROICexgc | N/A | ||
| OM | 7.95% | ||
| PM (TTM) | 5.33% | ||
| GM | 22.13% | ||
| FCFM | 6.59% |
ROA(3y)11.27%
ROA(5y)10.28%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)31.74%
ROIC(5y)33.13%
ROICexc(3y)48.36%
ROICexc(5y)62.43%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)44.78%
ROCE(5y)46.43%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y-27.17%
ROICexc growth 5Y-12.96%
OM growth 3Y4.16%
OM growth 5Y2.38%
PM growth 3Y6.55%
PM growth 5Y-7.79%
GM growth 3Y5.15%
GM growth 5Y3.26%
F-Score8
Asset Turnover1.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 2.74 | ||
| Debt/EBITDA | 1.63 | ||
| Cap/Depr | 70.62% | ||
| Cap/Sales | 1.1% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.86% | ||
| Profit Quality | 123.53% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.43 | ||
| Altman-Z | 1.91 |
F-Score8
WACC10.53%
ROIC/WACC2.63
Cap/Depr(3y)82.4%
Cap/Depr(5y)82.18%
Cap/Sales(3y)1.1%
Cap/Sales(5y)1.09%
Profit Quality(3y)99.21%
Profit Quality(5y)111.07%
High Growth Momentum
Growth
EPS 1Y (TTM)3.07%
EPS 3Y13.4%
EPS 5Y10.38%
EPS Q2Q%-3.49%
EPS Next Y3.27%
EPS Next 2Y4.88%
EPS Next 3Y5.87%
EPS Next 5Y5.83%
Revenue 1Y (TTM)-2.39%
Revenue growth 3Y-1.75%
Revenue growth 5Y-1.68%
Sales Q2Q%2.45%
Revenue Next Year-0.6%
Revenue Next 2Y1.37%
Revenue Next 3Y1.96%
Revenue Next 5Y0.84%
EBIT growth 1Y5.87%
EBIT growth 3Y2.34%
EBIT growth 5Y0.66%
EBIT Next Year17.36%
EBIT Next 3Y5.94%
EBIT Next 5Y0.74%
FCF growth 1Y-23.45%
FCF growth 3Y-7.45%
FCF growth 5Y-5.75%
OCF growth 1Y-24.15%
OCF growth 3Y-6.12%
OCF growth 5Y-4.64%