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Omar Venerio
Articles (1399) 

2 Stocks Jump Friday

Earnings boost shares of HP and Ambarella

November 30, 2018 | About:

Shares of HP Inc. (NYSE:HPQ) jumped more than 1% on Friday after the company posted fourth-quarter earnings of 54 cents per share on $15.4 billion in revenue on Thursday, reflecting 10.8% year-over-year growth. The company beat revenue expectations by $300 million, but earnings  were in line with estimates.

Our results once again demonstrate HP’s consistent performance with full-year non-GAAP EPS growth of 22% year over year and free cash flow generation of $4.2 billion,” President and CEO Dion Weisler said.

By segment, Personal Systems net sales rose 11% year over year, registering a 3.8% operating margin. Both Commercial and Consumer net revenue increased 11%. Total units inched up 6%, with Notebooks units increasing 8% and Desktops units up 2%.

Printing net revenue increased 9% year over year, with a 16.1% operating margin. Total hardware units were up 11%, with Commercial hardware units up 85% and Consumer hardware units up 3%. Supplies net revenue grew 7%.

The company generated $4.5 billion in net cash from operating activities and $4.2 billion in free cash flow. The strong liquidity position had an impact on shareholders, who received $3.5 billion through share repurchases and dividends.

Looking ahead to the first quarter of 2019, the company expects GAAP diluted net earnings per share to be between 46 cents and 49 cents and non-GAAP diluted net earnings to be in the range of 50 cents to 53 cents per share.

For fiscal 2019, the company projects GAAP diluted net earnings ranging from $2.04 to $2.14 per share and non-GAAP diluted net earnings between $2.12 and $2.22 per share.

Shares of Ambarella Inc. (NASDAQ:AMBA) gained nearly 19% on Friday after announcing third-quarter results. On Thursday, the company posted earnings of 21 cents per share on $57.million in revenue, a 35.7% year-over-year decline. The company beat earnings estimates by 12 cents and revenue expectations by $0.2 million.

The gross margin was 60.4%, down from 63.6% in the prior-year quarter.

Looking ahead to the fourth quarter, the company projects revenue of approximately $51 million and a gross margin in the range of 59% to 60.5%.

Disclosure:The author holds no positions in any stocks mentioned.

About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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