Earnings are up, but uncertainty lies ahead

Article Excerpt

On November 1, 2015, the old Hewlett-Packard Co. split into two firms: HP Enterprise and HP Inc. (see below). Hewlett-Packard shareholders received one share of HP Enterprise and one share of HP Inc. for each old share they held. Since the split, HP Enterprise is up about 95%, while HP Inc. is up 65%. However, we feel rising competition may challenge their ability to maintain their growth rates. HEWLETT-PACKARD ENTERPRISE CO. $18 (New York symbol HPE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares o/s: 1.6 billion; Market cap: $28.8 billion; Price-to-sales ratio: 0.9; Dividend yield: 1.7%; TSINetwork Rating: Average; www.hpe.com) sells computing services and products, such as servers and analytics software, to businesses and governments. The company’s earnings in its fiscal 2018 first quarter, ended January 31, 2018, rose 15.6%, to $547 million from $473 million a year earlier. HP Enterprise spent $742 million on share buybacks in the quarter. As a result, per-share earnings gained 21.4%, to $0.34 from $0.28. Those figures exclude several…

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