Hp Analysis

Note: this is a short, incomplete & free version of a more complete (6 page) report on HP.

Executive Summary - A giant stumbles

HP is a formidable company which has expanded aggressively through acquisitions in areas such as

IT services (EDS), servers & storage (3Par) and networking (3Com) to generate earnings growth.

The fundamental upside value of HP depends on the propensity of companies to buy a broad range

of "plain vanilla" IT (PCs, servers, storage, networking, services & printers), from one company (ie. HP).

Buy the complete report for more details ………

Capital Structure Per Share Total

Significant recent developments - Q1 2011 results & new CEO ($) ($ Bn)

- Group margins rose as higher PC operating margins off-set margin weakness in other divisions. Share Price 43.6

EPS increased, helped by a small real estate gain. HP reduced its revenue guidance for 2011. Number of Shares (bn) 2.3

Buy the complete report for more details ……… Market Capitalization 98.9

Net (Debt) / Cash - 5.0 -11.4

Minority Interests & Prefs - 17.8 - 40.4

Enterprise Value (EV) 66.5 150.8

Brief summary of historical results 2000-11 Net Debt / Market Cap. 11%

2003-8, HP was successfully turned-around following the 2001-2 downturn and Compaq merger.

Revenues, margins & EPS increased in all divisions. In particular, a good performance in Technology Financial Results 2010 2011e 2012e

Solutions drove this recovery in HP's earnings. Historically, printers has been the stable "cash cow". y/e 31 Oct ($ Bn) ($ Bn) ($ Bn)

Buy the complete report for more details ……… Sales 126.0 130.7 136.3

EBIT 11.5 15.5 16.3

Net Income 8.8 11.6 12.2

Share Capital 40.4 48.5 59.2

SWOT Analysis Total Assets 124.5 132.4 143.7

FCF 7.8 13.2 14.4

Strengths Weaknesses

- Size, brand, global reach & strong market positions - Focused on USA & Europe as well as PCs & Per Share Data 2010 2011e 2012e

(in PCs, servers, printers and IT services). printers - which are low growth areas. EPS ($) 3 .78 4 .98 5 .27

- Diversified & complimentary products & services. - Under invested in R&D since 2002. DPS ($) 0 .32 0 .35 0 .36

ie. A "one-stop-shop" for IT. - History of corporate scandals since 2002. Cash EPS ($) 3 .36 5 .68 6 .20

- Buy the complete report for more details ……… - Buy the complete report for more details ……… BV ($) 17.44 20.90 25.53

Efficiency analysis 2010 2011e 2012e

Opportunities Threats EBIT Margin 9.1 % 11.8 % 11.9 %

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