Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

HP Inc. (HPQ)

Company Dividend Discount ModelIndustry: Computer HardwareSector: Technology

Valuation Snapshot

Stable Growth$33.47 - $58.38$44.12
Multi-Stage$193.55 - $213.92$203.53
Blended Fair Value$123.82
Current Price$27.67
Upside347.50%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS1.76%-1.38%1.141.131.091.090.981.051.020.940.940.90
YoY Growth--1.21%3.66%0.00%10.55%-5.92%2.78%7.90%0.56%4.20%-31.36%
Dividend Yield--4.12%3.47%3.79%3.73%2.68%4.27%4.77%4.28%4.02%5.98%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)2,529.00
(-) Cash Dividends Paid (M)1,088.00
(=) Cash Retained (M)1,441.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)505.80316.13189.68
Cash Retained (M)1,441.001,441.001,441.00
(-) Cash Required (M)-505.80-316.13-189.68
(=) Excess Retained (M)935.201,124.881,251.33
(/) Shares Outstanding (M)953.75953.75953.75
(=) Excess Retained per Share0.981.181.31
LTM Dividend per Share1.141.141.14
(+) Excess Retained per Share0.981.181.31
(=) Adjusted Dividend2.122.322.45
WACC / Discount Rate3.70%3.70%3.70%
Growth Rate-2.48%-1.48%-0.48%
Fair Value$33.47$44.12$58.38
Upside / Downside20.95%59.44%110.98%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)2,529.002,491.602,454.762,418.452,382.692,347.452,417.88
Payout Ratio43.02%52.42%61.81%71.21%80.60%90.00%92.50%
Projected Dividends (M)1,088.001,306.021,517.351,722.141,920.552,112.712,236.54

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate3.70%3.70%3.70%
Growth Rate-2.48%-1.48%-0.48%
Year 1 PV (M)1,246.601,259.391,272.17
Year 2 PV (M)1,382.441,410.931,439.72
Year 3 PV (M)1,497.651,544.191,591.69
Year 4 PV (M)1,594.211,660.611,729.07
Year 5 PV (M)1,673.941,761.541,852.77
PV of Terminal Value (M)177,205.10186,478.81196,136.78
Equity Value (M)184,599.93194,115.48204,022.21
Shares Outstanding (M)953.75953.75953.75
Fair Value$193.55$203.53$213.92
Upside / Downside599.50%635.56%673.10%

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