What to Expect When HP Reports After the Close

May 29, 2018 by Chris Lange

HP Inc. (NYSE: HPQ) is scheduled to release its fiscal second-quarter financial results after the markets close on Tuesday. The consensus estimates call for $0.48 in earnings per share (EPS) on $13.57 billion in revenue. The same period of last year reportedly had $0.40 in EPS on $12.38 billion in revenue.

Makers of traditional PCs are facing flat sales worldwide in 2018. Yet, out of this group, HP is expected to lead the world in market share this year.

The firm maintained a comfortable lead over all others in the market with its eighth consecutive quarter of overall growth (up 4.3% year on year) and growth in all regions except Latin America.

In terms of the market in general, the tech research firm IDC detailed:

Worldwide shipments of traditional PCs (desktop, notebook, and workstation) totaled 60.4 million units and recorded flat (0.0%) year-on-year growth in the first quarter of 2018 (1Q18), according to the International Data Corporation (IDC) Worldwide Quarterly Personal Computing Device Tracker. The results exceeded the earlier forecast of a 1.5% decline and marks the third consecutive quarter where traditional PC shipment volume has hovered around flat growth year on year.

Excluding Tuesday’s move, HP had outperformed the broad markets, with its stock up 19% in the past 52 weeks. In just 2018 alone, the stock was up about 4%.

A few analysts weighed in on HP ahead of the report:

  • JPMorgan has an Overweight rating and a $28 price target.
  • Susquehanna has a Hold rating with a $22 price target.
  • RBC and UBS each have a Buy rating with a $28 price target.
  • BMO Capital Markets has a Market Perform rating with a $24 target.
  • Deutsche Bank has a Buy rating with a $27 price target.
  • But Maxim Group has a Hold rating with a $27 price target.

Shares of HP were last seen down 1.5% at $21.58, with a consensus analyst price target of $25.76 and a 52-week trading range of $17.10 to $24.75.

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