When HP Inc (NYSE:HPQ) and Hewlett Packard Enterprise decided to split into two companies, many people thought it would be of great benefit to shareholders. However, after yesterday’s earnings report, some may be beginning to question that strategy.
Fourth Quarter sales fell 9% in comparison to last year, making it the 16th quarter out of the past 17 in which revenues have continued to fall. Hewlett-Packard Enterprise is what some would refer to as the “old company”, and they are in charge of creating and selling software, services and data center equipment while HP Inc. is focused on desktop printers, 3D printers, and personal computers.
Earnings for the company came in lower than the Street had expected, at just 93 cents per share (compared to 96 cents that Wall Street had predicted). It should be interesting to see how these numbers effect today’s trading, prior to the Thanksgiving holiday.
The stock is down 13.05% or $1.91 after the negative news, hitting $12.73 per share. About 22.83 million shares traded hands or 33.12% up from the average. HPQ has declined 56.14% since April 23, 2015 and is downtrending. It has underperformed by 55.02% the S&P500.
Out of 21 analysts covering Hewlett-Packard (NYSE:HPQ), 9 rate it “Buy”, 0 “Sell”, while 12 “Hold”. This means 43% are positive. $45 is the highest target while $6 is the lowest. The $24.07 average target is 89.08% above today’s ($12.73) stock price. Hewlett-Packard was the topic in 49 analyst reports since August 17, 2015 according to StockzIntelligence Inc. Maxim Group upgraded the stock on November 23 to “Buy” rating. Mizuho maintained it with “Neutral” rating and $14 target price in a November 3 report. UBS initiated the shares of HPQ in a report on November 4 with “Neutral” rating. Needham initiated the firm’s rating on November 2. Needham has “Buy” rating and $14.50 price target. Finally, JP Morgan downgraded the stock to “Neutral” rating in a November 4 report.
The institutional sentiment increased to 0.86 in Q2 2015. Its up 0.05, from 0.81 in 2015Q1. The ratio improved, as 72 funds sold all HP Inc shares owned while 356 reduced positions. 76 funds bought stakes while 293 increased positions. They now own 1.37 billion shares or 3.97% less from 1.43 billion shares in 2015Q1.
Oldfield Partners Llp holds 11.96% of its portfolio in HP Inc for 6.77 million shares. Lamond Capital Partners Llc owns 337,000 shares or 10.27% of their US portfolio. Moreover, Goodhaven Capital Management Llc has 7.49% invested in the company for 786,086 shares. The California-based Dodge & Cox has invested 4.68% in the stock. Valueworks Llc, a New York-based fund reported 265,965 shares.
Since March 5, 2015, the stock had 0 buys, and 17 insider sales for $29.18 million net activity. Lesjak Catherine A sold 6,282 shares worth $165,531. Weisler Dion J sold 40,000 shares worth $1.01 million. Fink Martin sold 23,069 shares worth $567,696. Ricci Jeff T sold 7,243 shares worth $186,073. The insider Youngjohns Robert sold 21,143 shares worth $543,164.
HP INC, formerly Hewlett-Packard Company , is a global well-known provider of products, technologies, software, solutions and services to individual consumers, small- and medium-sized businesses (SMBs) and large enterprises, including clients in the government, health and education sectors. The company has a market cap of $26.78 billion. The Firm offers IT industry’s broadest portfolios of services and products that bring infrastructure, software, and services through innovation to enable its clients to create value and solve business problems. It has 5.2 P/E ratio. The Firm creates its solutions to provide foundation, in the areas of security, cloud, mobility and big data, by leveraging the breadth of its offerings and the strengths and capabilities of its individual business units.