Earnings Spotlight— HP Inc (NYSE:HPQ)

HP Inc (NYSE:HPQ) stock traded volume of 13558919 shares during its last trading session as compared to its average volume of 7129344 shares over the recent month. HPQ ended its day with the below stream along the move of -2.78% and closed at the price of $21.3 before opening at $21.74. It has total market capitalization is $34961260730. 52 week range of the stock remained $ 17.1 – 24.75 while its day lowest price was $21.2 and its hit its day highest price at $21.77

HP (NYSE:HPQ) reported Second Quarter Net revenue and EPS results.

Highlights

  • Second quarter GAAP diluted net earnings per share of $0.64, above the previously provided outlook of $0.42 to $0.46 per share
  • Second quarter non-GAAP diluted net earnings per share of $0.48, within the previously provided outlook of $0.45 to $0.49 per share
  • Second quarter net revenue of $14.0 billion, up 13% (up 10% in constant currency) from the prior-year period
  • Second quarter net cash provided by operating activities of $1,050 million
  • Second quarter free cash flow of $937 million
  • Second quarter returned $1,028 million to shareholders in the form of share repurchases and dividends

HP Inc. (“HP”) announced Fiscal 2018 second quarter net revenue of $14.0 billion, up 13% (up 10% in constant currency) from the prior-year period.

Second quarter GAAP diluted net EPS was $0.64, up from $0.33 in the prior-year period and above the previously provided outlook of $0.42 to $0.46. Second quarter non-GAAP diluted net EPS was $0.48, up from $0.40 in the prior-year period and within the previously provided outlook of $0.45 to $0.49. Second quarter non-GAAP net earnings and non-GAAP diluted net EPS exclude after-tax adjustments of $0.3 billion, or $0.16 per share, related to restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operating retirement-related credits/(charges), debt extinguishment costs and tax adjustments.

Dion Weisler, President and CEO, HP Inc said “We delivered another quarter of double digit year over year revenue and profit growth, strong EPS and impressive free cash flow and performed well across segments and regions”. “Our sharp focus on innovation, combined with operational excellence and driving profitable growth is paying off.”

Asset management

HP’s net cash provided by operating activities in the second quarter was $1.1 billion. Accounts receivable ended the quarter at $4.6 billion, up 3 days quarter over quarter to 30 days. Inventory ended the quarter at $5.6 billion, up 1 day quarter over quarter to 44 days. Accounts payable ended the quarter at $13.1 billion, up 7 days quarter over quarter to 104 days.

HP generated $937 million of free cash flow in the second quarter of Fiscal 2018. Free cash flow includes net cash provided by operating activities and net investments in property, plant and equipment of $113 million.

HP’s dividend payment of $0.1393 per share in the second quarter resulted in cash usage of $0.2 billion. HP also utilized $0.8 billion of cash during the quarter to repurchase approximately 35.4 million shares of common stock in the open market.  As a result, HP returned 110% of its free cash flow to shareholders in the second quarter of Fiscal 2018. HP exited the quarter with $5.3 billion in gross cash, which includes cash and cash equivalents and short-term investments of $1.1 billion included in other current assets.

Fiscal 2018 second quarter segment results

Personal Systems net revenue was up 14% year over year (up 11% in constant currency) with a 3.8% operating margin. Commercial net revenue increased 16% and Consumer net revenue increased 10%. Total units were up 7% with Notebooks units up 7% and Desktops units up 7%.

Printing net revenue was up 11% year over year (up 9% in constant currency) with a 16.0% operating margin. Total hardware units were up 13% with Commercial hardware units up 88% and Consumer hardware units up 4%. Supplies net revenue was up 8% (up 6% in constant currency).

Outlook

For the Fiscal 2018 third quarter, HP estimates GAAP diluted net EPS to be in the range of $0.47 to $0.51 and non-GAAP diluted net EPS to be in the range of $0.49 to $0.52. Fiscal 2018 third quarter non-GAAP diluted net EPS estimates exclude $0.01 to $0.02 per diluted share, primarily related to restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operating retirement-related credits/(charges), tax adjustments, and the related tax impact on these items.

For Fiscal 2018, HP raises estimates for GAAP diluted net EPS to be in the range of $2.75 to $2.82 and non-GAAP diluted net EPS to be in the range of $1.97 to $2.02.  Fiscal 2018 non-GAAP diluted net EPS estimates exclude $0.78 to $0.80 per diluted share, primarily related to restructuring and other charges, acquisition-related charges, defined benefit plan settlement charges, amortization of intangible assets, non-operating retirement-related credits/(charges), debt extinguishment costs, tax adjustments and the related tax impact on these items. In addition, HP anticipates generating free cash flow of at least $3.7 billion for Fiscal 2018.

Shares of HP Inc. have been recently spotted trading -13.94% off of the 52-week high price. On the other end, company shares have been noted 24.56% away from the low price over the last 52-weeks. 52 week range of the stock remained $ 17.10 – 24.75. Switching over to some distances from popular moving averages, we see that the stock has been recorded -2.86% away from the 50 day moving average and -0.56% away from the 200 day moving average. Moving closer, we can see that shares have been trading -3.36% off of the 20-day moving average. 49000 employees work in the Company. It has market cap of $34.98B and dividend yield of 2.63%.

  • Jeffrey Peterson
    Jeffrey Peterson a blogger and press writer, has worked on topics like earnings reports, hot stocks and market news. He is an experienced professional with 10+ years in research, analysis and reporting. He enjoys taking complex ideas and translating them into content aimed at the general public. He has personal interests in health, fitness, animal care, gardening, travel, world politics, and current social issues, but always willing to learn something new. Jeffrey has a Masters in Applied Finance and Investment. He specializes in income trading using options, is very conservative in his style and believes patience in waiting for the best setups is the key to successful trading. He covers articles for Technology category. Email Contact: Jeffrey@stockdigest.info

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