In the latest close session, HP (HPQ) was down 3.57% at $23.75. This change lagged the S&P 500's 0.38% gain on the day. Meanwhile, the Dow experienced a rise of 0.29%, and the technology-dominated Nasdaq saw an increase of 0.62%.
Coming into today, shares of the personal computer and printer maker had gained 1.4% in the past month. In that same time, the Computer and Technology sector lost 0.53%, while the S&P 500 gained 1.61%.
The investment community will be paying close attention to the earnings performance of HP in its upcoming release. It is anticipated that the company will report an EPS of $0.66, marking a 12% fall compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $14.62 billion, showing a 4.91% escalation compared to the year-ago quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $2.98 per share and revenue of $58.27 billion, indicating changes of -4.49% and +5.39%, respectively, compared to the previous year.
Investors might also notice recent changes to analyst estimates for HP. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. HP is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, HP is holding a Forward P/E ratio of 8.27. This denotes a discount relative to the industry average Forward P/E of 24.37.
It's also important to note that HPQ currently trades at a PEG ratio of 4.16. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The average PEG ratio for the Computer - Micro Computers industry stood at 2.74 at the close of the market yesterday.
The Computer - Micro Computers industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 19, putting it in the top 8% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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This article originally published on Zacks Investment Research (zacks.com).