HP (HPQ) Gains As Market Dips: What You Should Know

HP (HPQ) closed at $37.51 in the latest trading session, marking a +1.98% move from the prior day. This change outpaced the S&P 500's 0.4% loss on the day. Elsewhere, the Dow gained 0.08%, while the tech-heavy Nasdaq lost 0.18%.

Prior to today's trading, shares of the personal computer and printer maker had lost 1.84% over the past month. This has was narrower than the Computer and Technology sector's loss of 11.29% and the S&P 500's loss of 9.39% in that time.

Investors will be hoping for strength from HP as it approaches its next earnings release, which is expected to be May 31, 2022. The company is expected to report EPS of $1.06, up 13.98% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $16.1 billion, up 1.43% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.27 per share and revenue of $65.53 billion, which would represent changes of +12.66% and +3.22%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for HP. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.17% higher. HP is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, HP is currently trading at a Forward P/E ratio of 8.61. For comparison, its industry has an average Forward P/E of 16.34, which means HP is trading at a discount to the group.

Investors should also note that HPQ has a PEG ratio of 2.15 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. HPQ's industry had an average PEG ratio of 2.04 as of yesterday's close.

The Computer - Mini computers industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 247, which puts it in the bottom 2% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow HPQ in the coming trading sessions, be sure to utilize Zacks.com.

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