HP Inc shares: Price analysis before buying or selling

Can I receive dividends when I buy HP Inc shares?

Yes

ISIN code: US40434L1052

Ticker: NYSE: HPQ

Index or market: NYSE

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Elements to consider before selling or buying HP Inc shares

Analysis N°1

You should closely follow developments in the IT equipment market and the current rise in demand for quality equipment, particularly in emerging countries and from businesses.

Analysis N°2

Also keep an eye on the group's growth possibilities resulting from its recent diversification into the services sector and following the takeover of the EDS group, which is none other than the world's second largest service provider in this sector.

Analysis N°3

The pricing strategy pursued by HP is also at the heart of all the attention of analysts in this market. In order to preserve its margins, HP is forced to charge relatively high prices, which is a real disadvantage in the face of increasingly aggressive competition at this level.

Analysis N°4

In recent years, we have also observed an increase in the price of computer components, which also weighs on the group's profitability. It's therefore prudent to closely monitor this variable and its evolution.

Analysis N°5

Finally, you should follow the financial results of the HP group and more particularly the growth of its revenues over time.

Analysis before buying or selling HP Inc shares

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General presentation of HP Inc

The HP or Hewlett Packard group is a large American group in the IT sector. But it is also and above all one of the leaders in the design, manufacture and sale of computer equipment worldwide. The products of this group are found under the brand HP, Hewlett Packard and also Compaq.

The group's activity can be divided into different segments depending on the turnover achieved. They are shown below:

IT services such as consulting services, along with development, management and systems integration represent no less than 30% of turnover.
Next are computers and operating systems which represent 24% of sales.
Imaging and printing equipment such as printers, print servers, scanners, digital cameras, copiers and faxes, image processing software and others represent 20.4% of sales here. HP is currently the international leader in printing equipment.
Servers, storage systems and management software for businesses represent 19.1% of sales.
Finally, financial services such as financing and asset management services generate 3.3% of turnover.

The HP group achieves most of its profits internationally, i.e. 65.2%.

Photo credits: ©wolterk/123RF.COM

The major competitors of HP Inc

Although the HP group is one of the leaders in its sector in various segments, the competition it faces is quite fierce and numerous. It is therefore important to keep a close eye on the company's rivals, who are likely to take market share:

Lenovo

First of all, and on the side of the PC manufacturers, we will of course follow the market leader which is the Lenovo group. The latter is a Chinese company that mainly manufactures computers, telephones, workstations, computer servers and connected TVs. It was founded in 1984 and the brand became well known in 2005 when it acquired IBM's personal computing division, making it the world's largest PC manufacturer.

Dell

The Dell Group is an American company that is positioned as the number three computer manufacturer in the world. The group is based in Texas and also manufactures enterprise servers, data backup and storage systems and specific hardware for computer networks. The company is listed on the Nasdaq in the US and is part of the Nasdaq 100 stock index.

Apple Group

This American multinational company specialises in the creation and sale of consumer electronics such as personal computers and software as well as smartphones and tablets. The group is a giant in the sector, currently employing more than 137,000 people and operating more than 506 Apple Stores in nearly 25 countries around the world in addition to an online shop.

Canon Inc

In the specific segment of printers, the Canon Inc. group also competes directly with HP, which is the market leader. It is a Japanese company with headquarters in Tokyo that specialises in optical products including cameras, copiers and printers.

Seiko Epson Corporation

Finally, still in the field of printers, the Epson Group is a Japanese electronics company that offers a range of products for a wide range of customers in business, government and the general public. It is currently the third largest seller of printers in the world after HP and Canon, which we have just mentioned.

The major partners of HP Inc

Here are the recent important partnerships that the HP group has set up and which demonstrate its development strategy focused on sound alliances in different sectors.

Microsoft

In 2012, the HP group set up a strategic partnership with one of its competitors, the Microsoft group to provide cloud solutions around the world and through joint work.

Dropbox

In 2014, the HP group signed a partnership with Dropbox. HP computers have since been equipped with this software and service.

AutoDesk

In 2016, HP also set up a partnership with AutoDesk for innovation in 3D printing.

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The factors in favour of a rise in the HP Inc share price:

First of all, the HP group has a very large workforce since it currently employs more than 350,000 people across the world. With these very important resources, HP is able to respond effectively to any increase in demand. This strength also reflects the impressive size of this company and its importance in the market.

HP's global positioning in its business sector is also an undeniable advantage for this group. Keep in mind that the HP Company has a very important market share in the personal computer sector and therefore remains one of the international leaders in the computer equipment sector.

It's not surprising that HP has reached such a level in such a short time. The group has always focused its efforts on a consumer-cantered approach, which makes it a supplier recognized for the reliability and practicality of its products in the face of competition.

Additionally, the quality and availability of HP's customer service are undeniable assets of the group, which offers high quality after-sales services and maintains an excellent relationship with its customers. This allows it to have a high level of loyalty among other things.

Of course, in order to maintain this advantageous position, the HP group can also count on its strong capacity for innovation. The company invests a lot of money in research and innovation in order to constantly offer new products on the market.

Finally, the HP group also has a very strong distribution network which allows it to market its products quickly and efficiently throughout the world. This is the last strength available to this group.

The factors in favour of a drop in the HP Inc share price:

First of all, you must take into account the high level of competition in this sector of activity, with new adversaries every year. This strong competition makes it more complicated to grow HP's market share. The upsurge in fake products or imitations also tend to affect sales.

The second weak point of this value is the fact that the group produces its solutions only in large sets, which doesn't allow it to offer personalized solutions to its customers. Some of its main competitors can stand out and gain market share.

Finally, the last weak point is the delay that the company has taken in the digital entertainment market.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

Who are HP's main subcontractors?

The HP group subcontracts most of the manufacturing of its products, particularly the production of its personal computers. It entrusts the assembly of its computers to Chinese companies, including Compal Electronics, Foxconn, Inventec, Micro-Star International, MiTAC, Pegatron, Quanta Computer, TPV-Inventa Technology and Wistron, as well as to Czech and Mexican companies. Another part of its production is handled by the group itself, but this is not the majority.

What are the different subsidiaries of HP?

The HP group operates through various subsidiaries including Aruba Networks, 3PAR, HP Enterprise Services, HP Software and Solutions, Hewlett-Packard France, Hewlett-Packard India, Hewlett-Packard Japan, Hewlett Packard Australia, HP Israel, Hewlett Packard Austria, Hewlett Packard United Kingdom, Hewlett Packard Germany, Hewlett Packard Canada, Hewlett Packard Netherlands, HP Japan and Q30254561. Thanks to these various subsidiaries, the HP group has a strong international presence and can multiply its profits throughout the world. It can also diversify its activities by diversifying its product portfolio.

Does HP pay a dividend to shareholders?

The Hewlett Packard Group does pay a dividend to its shareholders. The last dividend paid by the group was $0.89 per share. Moreover, the company has paid its shareholders without interruption since 1980. This payment is made four times a year, as is the case for all American companies listed on the stock exchange in March, June, September and December. The current yield on this stock is 2.36%. Of course, this dividend changes every year and is not guaranteed by the company. To receive it, you must hold HP shares before the ex-dividend date.

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Analysis before buying or selling HP Inc shares