HP (HPQ) AI Stock Analysis

• Market Cap: $26.68B
• Dividend Yield: 4.01%
• Average Volume (3M): 8.21M
• Price to Earnings (P/E): 10.4
• Beta (1Y): 1.16
• Revenue Growth: 3.11%
• EPS Growth: -3.54%
• Country: US
• Employees: 58,000
• Sector: Technology
• Sector Strength: 88
• Industry: Computer Hardware
• EPS (TTM): 0.75
• Shares Outstanding: 934,701,840
• 10 Day Avg. Volume: 9,804,237
• 30 Day Avg. Volume: 8,206,072
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 0.58
• Enterprise Value/Gross Profit: 2.75
• Enterprise Value/Ebitda: 7.34
• 1Y Price Target: $27.83
• Price Target Upside: -2.49% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 9

• Rating: 73 Outperform
• Price Target: $30.00 ▲(5.12% Upside)

HP's overall stock score is driven by strong earnings call insights and attractive valuation. Technical analysis supports a positive trend, although financial performance is mixed due to balance sheet concerns. The company's strategic initiatives and cost savings are expected to bolster future performance.

Positive Factors

Earnings

HPQ reported F3Q results with EPS of $0.75, above the mid-point of guidance, with manufacturing diversification and pricing actions largely mitigating tariff headwinds.

Operational Efficiency

HPQ continues to make progress on its Future Ready Plan and remains on track to deliver $2 billion in annualized savings by the end of fiscal year 2025.

Product Demand

Strong consumer seasonality for back-to-school, healthy China trends, and commercial demand for Windows 11 refreshes and AI PCs contributed to Personal Systems revenue being 4% ahead of the Street view.

Negative Factors

Market Challenges

Margins face pressure from negative mix shift, operating profit is declining, and elevated leverage is limiting capital returns.

Pricing Environment

Print saw softness due to macro-driven pressure on IT spending and a more competitive pricing environment.

Print Segment Performance

Print revenues were down 5% quarter-over-quarter on seasonally softer supplies sales and total hardware units declined 9% year-over-year, with HPQ losing some share due to price competition from Japan peers.

HP Business Overview & Revenue Model

Company Description

HP Inc. (HPQ) is a global technology company known for its innovative hardware, software, and services solutions. The company operates primarily in two main sectors: Personal Systems and Printing. HP's core products include laptops, desktops, workstations, printers, and 3D printing solutions, along with a range of related services and accessories. With a focus on sustainability and technology advancements, HP aims to enhance the customer experience across various industries, from individual consumers to large enterprises.

How the Company Makes Money

HP generates revenue through multiple streams, primarily from the sale of Personal Systems and Printing products. In the Personal Systems segment, HP earns money from selling laptops, desktops, and accessories, benefiting from both direct sales and partnerships with retailers and distributors. The Printing segment contributes significantly to revenue through the sale of printers, ink, and toner cartridges, with a recurring revenue model based on consumables. Additionally, HP has ventured into 3D printing and related services, expanding its market reach. The company also engages in strategic partnerships and collaborations, enhancing its product offerings and market penetration, which further supports its revenue growth.

HP Financial Statement Overview

Summary

HP's financial performance is mixed. While the income statement shows stable revenue and profitability margins, the balance sheet reveals financial instability due to negative equity. Cash flow remains strong, but recent declines in free cash flow could affect future flexibility.

Income Statement

HP's income statement shows moderate performance. The TTM revenue of $54.3 billion reflects a slight growth of 1.38% compared to the previous year. Gross profit and net profit margins are stable with gross profit margin at 21.15% and net profit margin at 4.63%. However, both EBIT and EBITDA margins have slightly decreased over the TTM, indicating pressure on operating efficiency.

Balance Sheet

The balance sheet reveals some financial instability due to negative stockholders' equity, which indicates a leveraged position. The debt-to-equity ratio is not meaningful due to the negative equity. With an equity ratio of -3.29%, HP's reliance on debt could pose a risk, although its total debt has reduced slightly over the recent periods.

Cash Flow

HP's cash flow statement is a positive aspect, with a robust operating cash flow of $3.46 billion in the TTM and a healthy free cash flow of $2.66 billion. The free cash flow to net income ratio is 1.06, highlighting strong cash generation capabilities relative to net income. However, the free cash flow has declined by 15.77% from the previous period, which could affect future financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	54.30B	53.56B	53.72B	62.91B	63.46B	56.64B
Gross Profit	11.49B	11.82B	11.51B	12.26B	13.41B	10.42B
EBITDA	4.30B	4.72B	4.47B	5.46B	8.61B	4.24B
Net Income	2.52B	2.77B	3.26B	3.13B	6.54B	2.81B
Balance Sheet
Total Assets	38.80B	39.91B	37.00B	38.49B	38.60B	34.68B
Cash, Cash Equivalents and Short-Term Investments	2.73B	3.24B	3.11B	3.15B	4.30B	5.14B
Total Debt	10.74B	10.90B	10.74B	12.29B	8.78B	7.40B
Total Liabilities	40.08B	41.23B	38.07B	41.52B	40.25B	36.91B
Stockholders Equity	-1.28B	-1.32B	-1.07B	-3.02B	-1.64B	-2.23B
Cash Flow
Free Cash Flow	2.66B	3.16B	2.96B	3.67B	5.83B	3.74B
Operating Cash Flow	3.46B	3.75B	3.57B	4.46B	6.41B	4.32B
Investing Cash Flow	-1.50B	-646.00M	-590.00M	-3.55B	-1.01B	-1.02B
Financing Cash Flow	-1.74B	-3.08B	-2.89B	-2.07B	-5.96B	-2.97B

HP Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 28.54
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HPQ, the sentiment is Positive. The current price of 28.54 is above the 20-day moving average (MA) of 26.83, above the 50-day MA of 25.81, and below the 200-day MA of 28.72, indicating a bullish trend. The MACD of 0.75 indicates Negative momentum. The RSI at 70.03 is Negative, neither overbought nor oversold. The STOCH value of 87.54 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HPQ.

HP Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTAP	74 Outperform	$22.51B	19.93	123.00%	1.84%	3.45%	9.69%
WDC	74 Outperform	$27.87B	16.65	25.98%	0.12%	2.12%	―
HPQ	73 Outperform	$26.68B	10.39	84.33%	4.01%	3.11%	-3.54%
STX	72 Outperform	$35.60B	24.73	-109.27%	1.71%	38.86%	337.22%
SMCI	67 Neutral	$24.69B	25.03	17.90%	―	47.04%	-17.89%
DELL	64 Neutral	$82.92B	17.95	-179.12%	1.60%	10.50%	―
Sector *	61 Neutral	$35.45B	8.20	-10.08%	1.91%	8.56%	-9.51%

HP Corporate Events

HP Announces New Chief Accounting Officer Appointment

On June 18, 2025, HP Inc. announced that Stephanie Liebman will be leaving her position as Global Controller to pursue an outside opportunity, effective September 12, 2025. Manpreet S. Grewal has been appointed as the new Chief Accounting Officer and Global Controller, effective July 14, 2025. Mr. Grewal brings experience from his previous roles at United States Steel Corporation and Covanta. Additionally, HP’s Board of Directors has adopted amendments to the company’s bylaws to align with recent changes in the General Corporation Law of the State of Delaware, affecting the inspection rights of stockholders and directors.