HP INC (HPQ) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:HPQ - US40434L1052 - Common Stock
23.16 USD
+0.23 (+1%)
23.14 USD
-0.02 (-0.09%)
HPQ gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 35 industry peers in the Technology Hardware, Storage & Peripherals industry. HPQ has a medium profitability rating, but doesn't score so well on its financial health evaluation. HPQ is valued quite cheap, but it does not seem to be growing. Finally HPQ also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year HPQ was profitable.
HPQ had a positive operating cash flow in the past year.
Each year in the past 5 years HPQ has been profitable.
In the past 5 years HPQ always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.05%, HPQ is in the better half of the industry, outperforming 77.14% of the companies in the same industry.
HPQ has a Return On Invested Capital of 25.99%. This is amongst the best in the industry. HPQ outperforms 94.29% of its industry peers.
HPQ had an Average Return On Invested Capital over the past 3 years of 29.86%. This is significantly above the industry average of 15.26%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.05% | ||
| ROE | N/A | ||
| ROIC | 25.99% |
ROA(3y)7.28%
ROA(5y)9.38%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)29.86%
ROIC(5y)35.59%
1.3 Margins
HPQ has a better Profit Margin (4.57%) than 74.29% of its industry peers.
In the last couple of years the Profit Margin of HPQ has declined.
The Operating Margin of HPQ (6.55%) is better than 71.43% of its industry peers.
HPQ's Operating Margin has been stable in the last couple of years.
With a Gross Margin value of 20.60%, HPQ is not doing good in the industry: 68.57% 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 | 6.55% | ||
| PM (TTM) | 4.57% | ||
| GM | 20.6% |
OM growth 3Y-6.95%
OM growth 5Y-1.18%
PM growth 3Y-2.79%
PM growth 5Y-1.85%
GM growth 3Y1.86%
GM growth 5Y2.26%
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.
Compared to 5 years ago, HPQ has less shares outstanding
Compared to 1 year ago, HPQ has an improved debt to assets ratio.
2.2 Solvency
HPQ has a debt to FCF ratio of 3.45. This is a good value and a sign of high solvency as HPQ would need 3.45 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.45, HPQ is doing good in the industry, outperforming 71.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.45 | ||
| Altman-Z | N/A |
ROIC/WACC3.48
WACC7.46%
2.3 Liquidity
A Current Ratio of 0.77 indicates that HPQ may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.77, HPQ is doing worse than 85.71% of the companies in the same industry.
A Quick Ratio of 0.48 indicates that HPQ may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.48, HPQ is doing worse than 82.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.77 | ||
| Quick Ratio | 0.48 |
3. Growth
3.1 Past
HPQ shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -7.67%.
HPQ shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.64% yearly.
The Revenue has been growing slightly by 3.24% in the past year.
HPQ shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.48% yearly.
EPS 1Y (TTM)-7.67%
EPS 3Y-8.38%
EPS 5Y6.64%
EPS Q2Q%0%
Revenue 1Y (TTM)3.24%
Revenue growth 3Y-4.21%
Revenue growth 5Y-0.48%
Sales Q2Q%4.16%
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 4.74% on average per year.
Based on estimates for the next years, HPQ will show a small growth in Revenue. The Revenue will grow by 1.26% on average per year.
EPS Next Y-1%
EPS Next 2Y1.55%
EPS Next 3Y4%
EPS Next 5Y4.74%
Revenue Next Year1.96%
Revenue Next 2Y1.67%
Revenue Next 3Y1.61%
Revenue Next 5Y1.26%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
With a Price/Earnings ratio of 7.40, the valuation of HPQ can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of HPQ indicates a rather cheap valuation: HPQ is cheaper than 94.29% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.59, HPQ is valued rather cheaply.
The Price/Forward Earnings ratio is 7.47, which indicates a rather cheap valuation of HPQ.
Based on the Price/Forward Earnings ratio, HPQ is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
HPQ is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.03, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.4 | ||
| Fwd PE | 7.47 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, HPQ is valued cheaper than 100.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, HPQ is valued cheaper than 88.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.73 | ||
| EV/EBITDA | 6.08 |
4.3 Compensation for Growth
The decent profitability rating of HPQ may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.12
EPS Next 2Y1.55%
EPS Next 3Y4%
5. Dividend
5.1 Amount
HPQ has a Yearly Dividend Yield of 5.12%, which is a nice return.
Compared to an average industry Dividend Yield of 0.59, HPQ pays a better dividend. On top of this HPQ pays more dividend than 100.00% of the companies listed in the same industry.
HPQ's Dividend Yield is rather good when compared to the S&P500 average which is at 1.88.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
5.2 History
The dividend of HPQ is nicely growing with an annual growth rate of 9.97%!
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)9.97%
Div Incr Years14
Div Non Decr Years34
5.3 Sustainability
HPQ pays out 43.02% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of HPQ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP43.02%
EPS Next 2Y1.55%
EPS Next 3Y4%
23.16
+0.23 (+1%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners84%
Inst Owner Change1.87%
Ins Owners0.22%
Ins Owner Change8.98%
Market Cap21.65B
Revenue(TTM)55.30B
Net Income(TTM)2.53B
Analysts56
Price TargetN/A
Short Float %7.52%
Short Ratio5.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.12% |
Yearly Dividend1.16
Dividend Growth(5Y)9.97%
DP43.02%
Div Incr Years14
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.64%
Min EPS beat(2)-1.12%
Max EPS beat(2)-0.16%
EPS beat(4)0
Avg EPS beat(4)-3.83%
Min EPS beat(4)-12.57%
Max EPS beat(4)-0.16%
EPS beat(8)1
Avg EPS beat(8)-2.72%
EPS beat(12)2
Avg EPS beat(12)-1.72%
EPS beat(16)5
Avg EPS beat(16)-0.81%
Revenue beat(2)2
Avg Revenue beat(2)0.4%
Min Revenue beat(2)0.08%
Max Revenue beat(2)0.72%
Revenue beat(4)3
Avg Revenue beat(4)0.11%
Min Revenue beat(4)-0.41%
Max Revenue beat(4)0.72%
Revenue beat(8)5
Avg Revenue beat(8)-0.4%
Revenue beat(12)5
Avg Revenue beat(12)-1.01%
Revenue beat(16)7
Avg Revenue beat(16)-1.11%
PT rev (1m)-7.01%
PT rev (3m)-5.85%
EPS NQ rev (1m)-2.51%
EPS NQ rev (3m)-2.94%
EPS NY rev (1m)-8.83%
EPS NY rev (3m)-8.9%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)0.34%
Revenue NY rev (1m)0.35%
Revenue NY rev (3m)0.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.4 | ||
| Fwd PE | 7.47 | ||
| P/S | 0.39 | ||
| P/FCF | 7.73 | ||
| P/OCF | 5.86 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.08 |
EPS(TTM)3.13
EY13.51%
EPS(NY)3.1
Fwd EY13.38%
FCF(TTM)3
FCFY12.93%
OCF(TTM)3.96
OCFY17.08%
SpS59.16
BVpS-0.37
TBVpS-9.68
PEG (NY)N/A
PEG (5Y)1.12
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.05% | ||
| ROE | N/A | ||
| ROCE | 28.97% | ||
| ROIC | 25.99% | ||
| ROICexc | 36.92% | ||
| ROICexgc | 3251.08% | ||
| OM | 6.55% | ||
| PM (TTM) | 4.57% | ||
| GM | 20.6% | ||
| FCFM | 5.06% |
ROA(3y)7.28%
ROA(5y)9.38%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)29.86%
ROIC(5y)35.59%
ROICexc(3y)41.51%
ROICexc(5y)52.92%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)33.38%
ROCE(5y)40.28%
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3Y-9.52%
ROICexc growth 5Y-18.88%
OM growth 3Y-6.95%
OM growth 5Y-1.18%
PM growth 3Y-2.79%
PM growth 5Y-1.85%
GM growth 3Y1.86%
GM growth 5Y2.26%
F-Score5
Asset Turnover1.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 3.45 | ||
| Debt/EBITDA | 1.94 | ||
| Cap/Depr | 97.93% | ||
| Cap/Sales | 1.62% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 81.43% | ||
| Profit Quality | 110.72% | ||
| Current Ratio | 0.77 | ||
| Quick Ratio | 0.48 | ||
| Altman-Z | N/A |
F-Score5
WACC7.46%
ROIC/WACC3.48
Cap/Depr(3y)80.3%
Cap/Depr(5y)83.29%
Cap/Sales(3y)1.29%
Cap/Sales(5y)1.21%
Profit Quality(3y)105.09%
Profit Quality(5y)104.32%
High Growth Momentum
Growth
EPS 1Y (TTM)-7.67%
EPS 3Y-8.38%
EPS 5Y6.64%
EPS Q2Q%0%
EPS Next Y-1%
EPS Next 2Y1.55%
EPS Next 3Y4%
EPS Next 5Y4.74%
Revenue 1Y (TTM)3.24%
Revenue growth 3Y-4.21%
Revenue growth 5Y-0.48%
Sales Q2Q%4.16%
Revenue Next Year1.96%
Revenue Next 2Y1.67%
Revenue Next 3Y1.61%
Revenue Next 5Y1.26%
EBIT growth 1Y-13.76%
EBIT growth 3Y-10.87%
EBIT growth 5Y-1.66%
EBIT Next Year13.75%
EBIT Next 3Y5.38%
EBIT Next 5Y2.76%
FCF growth 1Y-11.31%
FCF growth 3Y-8.64%
FCF growth 5Y-5.6%
OCF growth 1Y-1.39%
OCF growth 3Y-6.08%
OCF growth 5Y-3.05%
HP INC / HPQ FAQ
Can you provide the ChartMill fundamental rating for HP INC?
ChartMill assigns a fundamental rating of 5 / 10 to HPQ.
What is the valuation status of HP INC (HPQ) stock?
ChartMill assigns a valuation rating of 8 / 10 to HP INC (HPQ). This can be considered as Undervalued.
Can you provide the profitability details for HP INC?
HP INC (HPQ) has a profitability rating of 6 / 10.
What is the valuation of HP INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for HP INC (HPQ) is 7.4 and the Price/Book (PB) ratio is -62.57.
Can you provide the dividend sustainability for HPQ stock?
The dividend rating of HP INC (HPQ) is 8 / 10 and the dividend payout ratio is 43.02%.