HP (HPQ) Stock Falls Amid Market Uptick: What Investors Need to Know

The investment community will be closely monitoring the performance of HP in its forthcoming earnings report. The company is expected to report EPS of $0.66, down 12% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $14.6 billion, up 4.82% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $2.98 per share and revenue of $58.26 billion, indicating changes of -4.49% and +5.37%, respectively, compared to the previous year.

It's also important for investors to be aware of any recent modifications to analyst estimates for HP. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. HP currently has a Zacks Rank of #3 (Hold).

From a valuation perspective, HP is currently exchanging hands at a Forward P/E ratio of 9.54. This indicates a discount in contrast to its industry's Forward P/E of 19.66.

It's also important to note that HPQ currently trades at a PEG ratio of 4.79. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. Computer - Micro Computers stocks are, on average, holding a PEG ratio of 2.92 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 20, this industry ranks in the top 9% of all industries, numbering over 250.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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