HPQHPQ
US • TECHNOLOGY
$25.75
P/E
9.50
PEG
0.59
FCF Yield
16.8%
Rev Growth YoY
+9.0% YoY
Gross Margin
20.3%
Health Score
8/10
D/E Ratio
0.32
Confidence
MEDIUM
Business Snapshot
HP Inc. is a global leader in the personal computing and printing technology industry, generating the vast majority of its revenue from the sale of PCs, laptops, and printers to consumers and enterprises. The company operates in a highly competitive, mature market where it holds a dominant position alongside a few other major players, commanding significant market share in both PC and printing segments. As a large-cap company with a market capitalization of $22.41B and TTM revenue of $57.42B, HP has substantial financial scale, generating enough cash to support its operations and shareholder returns. A defining characteristic of HP is its ability to generate significant free cash flow from a relatively low-margin hardware business, a function of its massive installed base and recurring consumables sales.
Financial Health
HP's financial health is strong, anchored by robust cash generation and a conservative capital structure. The company's gross margin is 20.3%, and its net margin stands at 4.5%, reflecting the high-volume, lower-margin nature of the hardware industry...
Risk Assessment
- REVENUE DECELERATION — While YoY revenue grew 9.0%, QoQ data is unavailable, preventing a full assessment of the most recent trend.
- ANALYST CONSENSUS — Only 8% of analysts rate the stock a Buy, with 50% rating it a Hold, indicating very limited conviction from Wall Street professionals.
- INSIDER ACTIVITY — Over the last 90 days, there was 1 insider sell versus 0 insider buys, a net negative signal that often precedes management's own lowered expectations.
- EARNINGS QUALITY — The company beat earnings estimates in only 2 out of the last 4 quarters, suggesting a 50% hit rate on management guidance.
- 52-WEEK POSITION — The current price of $25.75 is $3.54 below the 52-week high of $29.29 and $8.68 above the low of $17.07, trading in the upper half of its yearly range but with significant resistance at the previous peak....
HP's financial health is strong, anchored by robust cash generation and a conservative capital structure. The company's gross margin is 20.3%, and its net margin stands at 4.5%, reflecting the high-volume, lower-margin nature of the hardware industry. The balance sheet is in excellent shape, with a debt-to-equity ratio of just 0.32x, significantly below the leverage many peers carry, and a current ratio of 0.77x, which indicates tight liquidity but is common for large hardware manufacturers with strong cash conversion cycles. Critically, HP generated $3.77B in free cash flow, translating to an exceptional free cash flow yield of 16.8%, providing substantial capacity for dividends, share repurchases, and strategic reinvestment.
- REVENUE DECELERATION — While YoY revenue grew 9.0%, QoQ data is unavailable, preventing a full assessment of the most recent trend. - ANALYST CONSENSUS — Only 8% of analysts rate the stock a Buy, with 50% rating it a Hold, indicating very limited conviction from Wall Street professionals. - INSIDER ACTIVITY — Over the last 90 days, there was 1 insider sell versus 0 insider buys, a net negative signal that often precedes management's own lowered expectations. - EARNINGS QUALITY — The company beat earnings estimates in only 2 out of the last 4 quarters, suggesting a 50% hit rate on management guidance. - 52-WEEK POSITION — The current price of $25.75 is $3.54 below the 52-week high of $29.29 and $8.68 above the low of $17.07, trading in the upper half of its yearly range but with significant resistance at the previous peak.
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