Stock market: the earnings of HP

Stock market: the earnings of HP

2019-11-11 • Dikemaskini

The Q1 earnings season in the United States is almost at its end. This week HP Inc. will release its financial results. You can trade this stock with FBS (learn more) and make money!

EPS forecast: $0.51

Revenue forecast: $13.9B

Notice that Hewlett-Packard split into HP Enterprise and HP Inc. in 2015. With FBS, you can trade the stock of HP Inc. (HPQ).

According to the consensus forecast, the company’s earnings have increased by 6.3% y/y, while revenue has risen by 0.4% on an annual basis and fell by 4% q/q.

It’s necessary to point out that HP’s personal systems and printing businesses are both having a hard time. The main reasons for that are Intel INTC CPU shortages and weak consumer demand stemming from customers’ shift from personal computers to mobile devices. In addition, the uncertainty about global economic growth is bad for the printing segment. According to HP’s own forecasts, sales here will fall during the rest of 2019. This means that the firm’s financial results in the upcoming quarters may suffer — a bad prospect, no doubts.

On the other hand, there are some positive things we can say about the company as well. Revenue from notebooks and workstations is expected to be quite impressive. Moreover, HP is making significant effort to innovate and differentiate. This makes the company stand out in the row of competitors in PC business such as Dell and Apple.    

Technical picture

HP weekly.png

This year hasn’t been particularly kind to HP. The stock rose in January and February but then made a sharp reversal down from the level of 24.00. Support is provided by the 200-week MA that’s currently located in the 17.90 area.

So far, the price met the resistance of the 50-day MA at 19.63. A break above this level will open the way up to 20.60 (100-day MA). Still, the stock has been up ahead of the earnings report, so going down will be the path of the least resistance for it in the short-term. Watch support at 18.50 and 18.20. A break below 17.90 is needed to make the price vulnerable for a decline to 17.10 and 16.00.  

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