Latest news with #HPEnterprise
Business Insider
5 days ago
- Business
- Business Insider
HP Enterprise up 3% after Q2 results and updated FY25 guidance
16:25 EDT HP Enterprise (HPE) up 3% after Q2 results and updated FY25 guidance Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>>
Yahoo
04-04-2025
- Business
- Yahoo
3 Reasons DXC is Risky and 1 Stock to Buy Instead
What a brutal six months it's been for DXC. The stock has dropped 21.4% and now trades at $16.38, rattling many shareholders. This might have investors contemplating their next move. Is now the time to buy DXC, or should you be careful about including it in your portfolio? Check out our in-depth research report to see what our analysts have to say, it's free. Even with the cheaper entry price, we're cautious about DXC. Here are three reasons why you should be careful with DXC and a stock we'd rather own. Born from the 2017 merger of Computer Sciences Corporation and HP Enterprise's services business, DXC Technology (NYSE:DXC) is a global IT services company that helps businesses transform their technology infrastructure, applications, and operations. We can better understand IT Services & Consulting companies by analyzing their organic revenue. This metric gives visibility into DXC's core business because it excludes one-time events such as mergers, acquisitions, and divestitures along with foreign currency fluctuations - non-fundamental factors that can manipulate the income statement. Over the last two years, DXC's organic revenue averaged 4.2% year-on-year declines. This performance was underwhelming and implies it may need to improve its products, pricing, or go-to-market strategy. It also suggests DXC might have to lean into acquisitions to grow, which isn't ideal because M&A can be expensive and risky (integrations often disrupt focus). We track the long-term change in earnings per share (EPS) because it highlights whether a company's growth is profitable. Sadly for DXC, its EPS declined by 11.5% annually over the last five years, more than its revenue. This tells us the company struggled because its fixed cost base made it difficult to adjust to shrinking demand. ROIC, or return on invested capital, is a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity). We like to invest in businesses with high returns, but the trend in a company's ROIC is what often surprises the market and moves the stock price. Unfortunately, DXC's ROIC has decreased significantly over the last few years. Paired with its already low returns, these declines suggest its profitable growth opportunities are few and far between. We cheer for all companies serving everyday consumers, but in the case of DXC, we'll be cheering from the sidelines. After the recent drawdown, the stock trades at 5.1× forward price-to-earnings (or $16.38 per share). While this valuation is optically cheap, the potential downside is huge given its shaky fundamentals. There are better stocks to buy right now. Let us point you toward a top digital advertising platform riding the creator economy. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free.
Yahoo
07-03-2025
- Business
- Yahoo
Why Hewlett Packard Enterprise Stock Tanked Today
Hewlett Packard Enterprise (NYSE: HPE) stock collapsed in a 15.2% rout (through 9:50 a.m. ET) this morning after reporting mixed earnings last night, and forecasting a significantly worse 2025 than most Wall Street analysts had been expecting. For Q1 2025, estimates had HP Enterprise (as I'll call it here, to distinguish this enterprise IT specialist from its better-known brother, HP (NYSE: HPQ), which specializes in personal computers) earning $0.50 per share on just over $7.8 billion in revenue. Turns out, HP Enterprise beat the revenue forecast, with $7.85 billion. But its earnings fell a penny short of the consensus at only $0.49. The news wasn't all bad. HP Enterprise grew its revenue 17% year over year. It showed especial strength in artificial intelligence (AI), with "1.6 billion in net orders for AI systems" and "enterprise AI orders [up] 40%" year over year. And yet, the news that was bad was pretty darn bad. Gross margins, for example, plunged 720 basis points to just 29.2%. And although earnings as calculated according to generally accepted accounting principles (GAAP) rose 52%, the company's GAAP profit was a whole nickel below the $0.49 non-GAAP profit noted: $0.44. Arguably worst of all, HP Enterprise burned through $877 million in negative free cash flow, calling into serious question the quality of its earnings. Turning to guidance, management said Q2 sales will range from $7.2 billion to $7.6 billion (versus the $7.9 billion Wall Street was expecting). Non-GAAP profit will be no more than $0.34 per share (versus analyst predictions of $0.50). Nor will the full year be much better. On the one hand, management says 2025 revenue may grow 7% to 11% over 2024 levels -- $32.2 billion to $33.4 billion. That's probably going to beat the Street's $32.5 billion forecast. Non-GAAP earnings, however, won't exceed $1.90 per share -- and the Street wants to see $2.13. That's a big miss, folks. And it may make HP Enterprise stock a sell. Before you buy stock in Hewlett Packard Enterprise, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Hewlett Packard Enterprise wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $677,631!* Now, it's worth noting Stock Advisor's total average return is 822% — a market-crushing outperformance compared to 166% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of March 3, 2025 Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends HP. The Motley Fool has a disclosure policy. Why Hewlett Packard Enterprise Stock Tanked Today was originally published by The Motley Fool
