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HP (HPQ) Gains But Lags Market: What You Should Know

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In the latest trading session, HP (HPQ - Free Report) closed at $32.79, marking a +0.37% move from the previous day. The stock trailed the S&P 500, which registered a daily gain of 1.83%. On the other hand, the Dow registered a gain of 1.65%, and the technology-centric Nasdaq increased by 2.45%.

Shares of the personal computer and printer maker have depreciated by 3.46% over the course of the past month, outperforming the Computer and Technology sector's loss of 3.84% and lagging the S&P 500's loss of 3.31%.

Investors will be eagerly watching for the performance of HP in its upcoming earnings disclosure. In that report, analysts expect HP to post earnings of $0.74 per share. This would mark a year-over-year decline of 8.64%. Simultaneously, our latest consensus estimate expects the revenue to be $13.48 billion, showing a 2.25% escalation compared to the year-ago quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $3.56 per share and revenue of $55.11 billion. These totals would mark changes of +5.33% and +2.89%, respectively, from last year.

It's also important for investors to be aware of any recent modifications to analyst estimates for HP. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. HP currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that HP has a Forward P/E ratio of 9.18 right now. This indicates a discount in contrast to its industry's Forward P/E of 12.78.

We can also see that HPQ currently has a PEG ratio of 2.79. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. Computer - Micro Computers stocks are, on average, holding a PEG ratio of 1.66 based on yesterday's closing prices.

The Computer - Micro Computers industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 86, this industry ranks in the top 35% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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