KGI Securities has commenced its analysis of HP Inc. (HPQ, Financial) by assigning a Neutral rating to the stock, alongside setting a price target of $25. This move provides investors with a foundational perspective on HPQ's market position and prospects. The assessment reflects an evaluation of the company's current performance and future potential. Investors are encouraged to consider these ratings in their decision-making process as they navigate the market dynamics surrounding HPQ.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 13 analysts, the average target price for HP Inc (HPQ, Financial) is $31.95 with a high estimate of $38.00 and a low estimate of $27.00. The average target implies an
upside of 17.45%
from the current price of $27.20. More detailed estimate data can be found on the HP Inc (HPQ) Forecast page.
Based on the consensus recommendation from 16 brokerage firms, HP Inc's (HPQ, Financial) average brokerage recommendation is currently 2.8, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for HP Inc (HPQ, Financial) in one year is $32.44, suggesting a
upside
of 19.26% from the current price of $27.2. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the HP Inc (HPQ) Summary page.
HPQ Key Business Developments
Release Date: May 28, 2025
- Revenue Growth: 5% increase in constant currency year-over-year.
- Personal Systems Revenue: Grew 8% in constant currency, driven by strong commercial performance.
- PC Commercial Revenue: Increased 9% year-over-year.
- Print Revenue: Declined 3% in constant currency.
- Operating Margin: 7.3%, impacted by approximately 100 basis points due to tariff-related costs.
- Non-GAAP Earnings Per Share: $0.71, impacted by $0.12 due to tariff-related costs.
- Gross Margin: 20.7%, down year-over-year due to increased tariff and commodity costs.
- Free Cash Flow: Slightly negative due to timing of payments for inventory actions.
- Shareholder Returns: Approximately $400 million returned through dividends and share repurchases.
- FY25 Non-GAAP EPS Guidance: $3 to $3.30.
- FY25 GAAP EPS Guidance: $2.32 to $2.62.
- Q3 Non-GAAP EPS Guidance: $0.68 to $0.80.
- Q3 GAAP EPS Guidance: $0.57 to $0.69.
- FY25 Free Cash Flow Guidance: $2.6 billion to $3 billion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- HP Inc (HPQ, Financial) delivered revenue growth for the fourth consecutive quarter, with a 5% increase in constant currency year-over-year.
- The Personal Systems segment saw an 8% revenue growth in constant currency, driven by strong commercial performance and demand for AI PCs.
- HP Inc (HPQ) is accelerating its manufacturing footprint diversification, with plans to have nearly all products sold in North America built outside of China by June.
- The company introduced over 80 new products and services at the global AMPLIFY conference, receiving positive feedback from partners and customers.
- HP Inc (HPQ) is on track to achieve at least $2 billion in gross annual run rate structural savings by the end of fiscal year 2025, exceeding previous goals.
Negative Points
- HP Inc (HPQ)'s non-GAAP operating profit fell short of expectations due to additional tariff costs that could not be fully mitigated in the quarter.
- Print segment revenue declined 3% in constant currency, impacted by a slowdown in North America and weak demand in China.
- The company faced a net impact of approximately 100 basis points on non-GAAP operating profit due to tariff-related issues.
- HP Inc (HPQ) moderated its guidance for the second half of the year due to macroeconomic uncertainties and potential impacts from trade policies.
- Free cash flow guidance was revised downwards, reflecting the impact of tariff-related costs and lower-than-expected working capital improvements.
