HP(US:HPQ) ZACKS·2025-11-05 00:01Core Viewpoint - HP's stock performance has lagged behind major indices, with a recent decline of 3.96% compared to the S&P 500's loss of 1.17, indicating potential concerns among investors regarding the company's upcoming earnings report [1][2]. Financial Performance - HP is expected to report an EPS of $0.92, reflecting a 1.08% decrease from the same quarter last year, while revenue is forecasted at $14.79 billion, representing a 5.23% increase year-over-year [2]. - For the entire fiscal year, earnings are projected at $3.11 per share, down 7.99% from the previous year, with revenue expected to remain flat at $55.2 billion [3]. Analyst Sentiment - Recent adjustments to analyst estimates indicate a downward trend, with the Zacks Consensus EPS estimate decreasing by 0.3% in the past month, leading to a Zacks Rank of 4 (Sell) for HP [5]. - The correlation between estimate revisions and share price momentum suggests that positive changes in estimates could indicate analyst optimism regarding HP's business and profitability [4]. Valuation Metrics - HP's Forward P/E ratio stands at 8.13, significantly lower than the industry average of 14.47, suggesting that HP may be undervalued compared to its peers [6]. - The company's PEG ratio is 2.03, higher than the industry average of 1.51, indicating that HP's expected earnings growth may not justify its current valuation [7]. Industry Context - The Computer - Micro Computers industry, which includes HP, ranks 96 in the Zacks Industry Rank, placing it in the top 39% of over 250 industries, suggesting a relatively strong position within the sector [8].