HPE Intrinsic Value Calculation – Hewlett Packard Enterprise Beats Non-GAAP EPS Estimates, But Misses Revenue Expectations
November 29, 2023
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Hewlett Packard Enterprise ($NYSE:HPE) (HPE) recently reported earnings which showed mixed results. On the one hand, their Non-GAAP EPS of $0.52 exceeded analyst expectations, beating them by $0.02.
However, on the other hand, total revenue of $7.35B fell short of expectations by $20M. HPE is an American technology company headquartered in Palo Alto, California. HPE focuses on providing IT infrastructure, data storage, networking solutions, software development, and analytics products to organizations around the world. The company also offers services such as consulting, cloud computing, managed services, and other IT support services.
Earnings
In its latest earnings report for FY2023 Q3 ending July 31 2021, Hewlett Packard Enterprise (HPE) reported total revenue of 6897.0M USD, a 0.8% decrease compared to the previous year, and net income of 392.0M USD, a 4.2% decrease from the previous year. Despite the slight decrease in revenue, HPE beat non-GAAP EPS estimates.
However, the total revenue of 7002.0M USD fell short of expectations. The last 3 years have seen HPE’s total revenue increase from 6897.0M USD to 7002.0M USD. Despite the slight increase, the reported revenue still fell short of expectations in the most recent quarter. HPE’s net income also dropped by 4.2%. Although the company managed to beat estimated earnings per share, the overall performance in the most recent quarter was not as strong as expected.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for HPE. More…
| Total Revenues | Net Income | Net Margin |
| 29.66k | 1.08k | 7.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for HPE. More…
| Operations | Investing | Financing |
| 4.62k | -4.05k | -1.75k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for HPE. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 56.41k | 35.74k | 16.07 |
Key Ratios Snapshot
Some of the financial key ratios for HPE are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 3.2% | 10.1% | 5.6% |
| FCF Margin | ROE | ROA |
| 5.0% | 5.1% | 1.8% |
Price History
Hewlett Packard Enterprise (HPE) reported mixed results on Tuesday with non-GAAP earnings per share (EPS) beating estimates but revenue missing expectations. Despite the mixed results, the stock opened at $15.6 in the morning and closed at $15.5, down by 0.5% from the prior day’s closing price of $15.6. HPE is now looking to focus on developing innovative products and services to drive growth in future quarters. Live Quote…
Analysis – HPE Intrinsic Value Calculation
At GoodWhale, we regularly analyze the fundamentals of companies to determine their fair value. After analyzing HEWLETT PACKARD ENTERPRISE, we have determined that the fair value of their stock is around $16.0. Our proprietary Valuation Line uses our sophisticated algorithm to calculate this figure. Currently, the stock is trading at $15.5, which is a fair price but is slightly undervalued by 3.3%. Investing in HEWLETT PACKARD ENTERPRISE at this price would be a great opportunity for investors to benefit from the potential upside of the stock. More…
Peers
The competition between Hewlett Packard Enterprise Co and its competitors, Dawning Information Industry Co Ltd, Eastern Communications Co Ltd, and Accton Technology Corp, is fierce. All four companies have invested heavily in research and development to stay ahead of the competition in the ever-evolving technology industry. Each company is striving to create innovative products and services that will give them an edge over their rivals. As the competition continues to heat up, each company is sure to bring their best to the table.
– Dawning Information Industry Co Ltd ($SHSE:603019)
Dawning Information Industry Co Ltd is a Chinese company that provides information technology and services. The company has a market cap of 32.11B as of 2022, making it one of the largest companies in its sector. Its Return on Equity (ROE) is 7.36%, which is relatively high compared to other companies in the same industry. The company’s ROE is a measure of how efficiently the company uses its resources to generate profits, and its market cap is an indication of the company’s size and value to investors.
– Eastern Communications Co Ltd ($SHSE:600776)
Eastern Communications Co Ltd is a telecommunications company that provides cable television, internet, phone services, and other related products and services. The company has a market capitalization of 9.62 billion as of 2022, which indicates its size and scope in the industry. Eastern Communications also boasts a Return on Equity of 2.34%, indicating its financial strength and ability to generate profits for its shareholders. This indicates that the company is performing well and is a promising investment opportunity.
– Accton Technology Corp ($TWSE:2345)
Accton Technology Corp is a leader in the networking and communications industry, providing innovative solutions for the global marketplace. It has a market capitalization of 141.69 billion as of 2022, reflecting its size and market position. The company’s Return on Equity (ROE) of 34.76% indicates the ability to generate profits from every dollar of shareholder equity. This is an impressive figure that demonstrates Accton’s ability to effectively utilize its assets and resources. The company has continued to develop innovative products and services for customers around the world, helping to cement its place as a leader in the industry.
Summary
Hewlett Packard Enterprise (HPE) recently released its quarterly earnings report, showing Non-GAAP earnings per share of $0.52, beating analysts’ expectations by $0.02.
However, revenue of $7.35 billion fell short of expectations by $20 million. The company also announced that it will be repurchasing up to $2 billion of its own shares. In terms of guidance, HPE expects full-year revenue to be in line with analyst estimates and for adjusted earnings per share to be slightly higher than estimates. Looking forward, investors should watch for the company’s progress in its cloud initiatives and its ability to capitalize on emerging technologies such as artificial intelligence and blockchain. HPE’s strong cash flow and dividend yield of 4%, offer investors a degree of security compared to other tech stocks.
