HEWLETT PACKARD ENTERPRISE (HPE)
US42824C1099 - Common Stock
Taking everything into account, HPE scores 5 out of 10 in our fundamental rating. HPE was compared to 32 industry peers in the Technology Hardware, Storage & Peripherals industry. While HPE belongs to the best of the industry regarding profitability, there are concerns on its financial health. HPE is valued quite cheap, but it does not seem to be growing. HPE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year HPE was profitable.
HPE had a positive operating cash flow in the past year.
HPE had positive earnings in 4 of the past 5 years.
Each year in the past 5 years HPE had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.05%, HPE is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
HPE has a Return On Equity of 8.40%. This is amongst the best in the industry. HPE outperforms 81.25% of its industry peers.
With a decent Return On Invested Capital value of 4.76%, HPE is doing good in the industry, outperforming 62.50% 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 16.81%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.05% | ||
| ROE | 8.4% | ||
| ROIC | 4.76% |
ROA(3y)3.67%
ROA(5y)2.49%
ROE(3y)10.36%
ROE(5y)7.04%
ROIC(3y)4.94%
ROIC(5y)4.82%
1.3 Margins
With a decent Profit Margin value of 6.39%, HPE is doing good in the industry, outperforming 78.13% of the companies in the same industry.
HPE's Profit Margin has improved in the last couple of years.
HPE has a Operating Margin of 7.83%. This is in the better half of the industry: HPE outperforms 68.75% of its industry peers.
In the last couple of years the Operating Margin of HPE has grown nicely.
HPE has a Gross Margin (33.88%) which is in line with its industry peers.
In the last couple of years the Gross Margin of HPE has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.83% | ||
| PM (TTM) | 6.39% | ||
| GM | 33.88% |
OM growth 3Y12.51%
OM growth 5Y1.94%
PM growth 3YN/A
PM growth 5Y2.36%
GM growth 3Y3.84%
GM growth 5Y3.27%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), HPE is destroying value.
HPE has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, HPE has less shares outstanding
Compared to 1 year ago, HPE has an improved debt to assets ratio.
2.2 Solvency
HPE has an Altman-Z score of 0.93. 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 of 0.93. This is in the lower half of the industry: HPE underperforms 68.75% of its industry peers.
The Debt to FCF ratio of HPE is 4.34, which is a neutral value as it means it would take HPE, 4.34 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.34, HPE is in the better half of the industry, outperforming 71.88% of the companies in the same industry.
HPE has a Debt/Equity ratio of 0.39. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of HPE (0.39) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.39 | ||
| Debt/FCF | 4.34 | ||
| Altman-Z | 0.93 |
ROIC/WACC0.45
WACC10.52%
2.3 Liquidity
A Current Ratio of 0.94 indicates that HPE may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.94, HPE is doing worse than 84.38% of the companies in the same industry.
A Quick Ratio of 0.62 indicates that HPE may have some problems paying its short term obligations.
HPE has a Quick ratio of 0.62. This is amonst the worse of the industry: HPE underperforms 87.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.62 |
3. Growth
3.1 Past
HPE shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -13.12%.
HPE shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.59% yearly.
HPE shows a decrease in Revenue. In the last year, the revenue decreased by -2.14%.
The Revenue has been decreasing by -1.14% on average over the past years.
EPS 1Y (TTM)-13.12%
EPS 3Y16.96%
EPS 5Y6.59%
EPS Q2Q%2.04%
Revenue 1Y (TTM)-2.14%
Revenue growth 3Y2.59%
Revenue growth 5Y-1.14%
Sales Q2Q%10.11%
3.2 Future
The Earnings Per Share is expected to grow by 6.50% on average over the next years.
HPE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.46% yearly.
EPS Next Y-8.4%
EPS Next 2Y-0.82%
EPS Next 3Y1.42%
EPS Next 5Y6.5%
Revenue Next Year2.71%
Revenue Next 2Y5.03%
Revenue Next 3Y4.58%
Revenue Next 5Y2.46%
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 stable.
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
A Price/Earnings ratio of 10.97 indicates a reasonable valuation of HPE.
HPE's Price/Earnings ratio is rather cheap when compared to the industry. HPE is cheaper than 81.25% of the companies in the same industry.
HPE is valuated cheaply when we compare the Price/Earnings ratio to 28.53, which is the current average of the S&P500 Index.
HPE is valuated reasonably with a Price/Forward Earnings ratio of 9.92.
Based on the Price/Forward Earnings ratio, HPE is valued a bit cheaper than 71.88% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of HPE to the average of the S&P500 Index (23.40), we can say HPE is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.97 | ||
| Fwd PE | 9.92 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HPE is valued cheaply inside the industry as 93.75% of the companies are valued more expensively.
84.38% of the companies in the same industry are more expensive than HPE, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.06 | ||
| EV/EBITDA | 7.24 |
4.3 Compensation for Growth
HPE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.67
EPS Next 2Y-0.82%
EPS Next 3Y1.42%
5. Dividend
5.1 Amount
HPE has a Yearly Dividend Yield of 2.44%. Purely for dividend investing, there may be better candidates out there.
HPE's Dividend Yield is rather good when compared to the industry average which is at 2.97. HPE pays more dividend than 90.63% of the companies in the same industry.
HPE's Dividend Yield is comparable with the S&P500 average which is at 2.22.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.44% |
5.2 History
The dividend of HPE has a limited annual growth rate of 5.03%.
HPE has been paying a dividend for at least 10 years, so it has a reliable track record.
As HPE did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)5.03%
Div Incr Years1
Div Non Decr Years8
5.3 Sustainability
35.63% of the earnings are spent on dividend by HPE. This is a low number and sustainable payout ratio.
HPE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP35.63%
EPS Next 2Y-0.82%
EPS Next 3Y1.42%
HEWLETT PACKARD ENTERPRISE
NYSE:HPE (11/15/2024, 8:16:58 PM)
After market: 21.09 +0.02 (+0.09%)21.07
-0.27 (-1.27%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap27.36B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.44% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.97 | ||
| Fwd PE | 9.92 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)1.67
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.05% | ||
| ROE | 8.4% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 7.83% | ||
| PM (TTM) | 6.39% | ||
| GM | 33.88% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.39 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.62 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-13.12%
EPS 3Y16.96%
EPS 5Y
EPS Q2Q%
EPS Next Y-8.4%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-2.14%
Revenue growth 3Y2.59%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y