HP Inc blows past Wall Street estimates in the fiscal fourth quarter

HP Inc blows past Wall Street estimates in the fiscal fourth quarter
Written by:
Wajeeh Khan
November 25, 2020
  • HP Inc. reports £11.46 billion of revenue and 46.42 pence of adjusted EPS in Q4.
  • The tech firm forecasts up to 52.41 pence of adjusted per-share earnings in Q1.
  • HP says notebooks sales were 18% up in the 4th quarter on an annualised basis.

HP Inc. (NYSE: HPQ) reported its financial results for the fiscal fourth quarter on Tuesday that came in better than what analysts had anticipated. The company also gave upbeat guidance for the future. Earlier this month, the Palo Alto-based company introduced HP+, dubbed the most modern and simple printing solution on the market.

HP Inc. was reported roughly 5% up in after-hours trading on Tuesday. Including the price action, the stock is now trading at £17.18 per share that translates to an about 75% growth since its year to date low in March.

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In comparison, HP shares were exchanging hands at £15.57 at the start of the year. An insight into the price action will come in handy if you’re interested in investing in the stock market.

HP’s Q4 financial results versus analysts’ estimates

According to Refinitiv, experts had forecast the company to print £11.01 billion of revenue in the fourth quarter. Their estimate for earnings per share stood at 38.93 pence. In its report on Tuesday, HP topped both estimates posting a higher £11.46 billion of revenue and 46.42 pence of adjusted earnings per share.

On an annualised basis, HP’s revenue in Q4 was 1% down and marked the fourth consecutive quarter for HP to have seen a decline in revenue. At £7.79 billion, the technology company’s revenue from its largest segment, Personal Systems, remained unchanged in the fourth quarter from last year, and was marginally lower than £7.86 billion expected.

In separate news from the United States, HP’s competitor, Dell Technologies, also published its quarterly financial report on Tuesday.

HP’s guidance for the fiscal first quarter

For the fiscal first quarter, the American multinational is now expecting its adjusted per-share earnings to fall in the range of 47.92 pence to 52.41 pence. Analysts, on the other hand, are calling for a lower 40.43 pence per share of earnings for HP in Q1.

HP also said on Tuesday that it sold £5.55 billion worth of notebooks in the recent quarter that represents an 18% year over year growth. The increase in notebooks sales, the company added, was attributed to the COVID-19 crisis that restricted people to their homes and made them work from home.   

HP remained almost flat on average in the stock market last year. At the time of writing, it is valued at £22.36 billion and has a price to earnings ratio of 12.27.