Research Desk Line-up: Dell Technologies Post Earnings Coverage

LONDON, UK / ACCESSWIRE / June 13, 2017 / Pro-Trader Daily publishes post-earnings coverage on HP Inc. (NYSE: HPQ) following the Company's announcement of its second quarter fiscal 2017 earnings results on May 24, 2017. The personal computer and printer maker reported a third consecutive quarter growth in revenue. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Get more of our free earnings reports coverage from other constituents of the Diversified Computer Systems industry. Pro-TD has currently selected Dell Technologies Inc. (NYSE: DVMT) for due-diligence and potential coverage as the Company announced on June 08, 2017, its financial results for Q1 FY18. Register for a free membership today, and be among the early birds that get access to our report on Dell Technologies when we publish it.

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Earnings Reviewed

HP announced net revenue of $12.39 billion for the quarter ended April 30, 2017, up 7% as compared to net revenue of $11.59 billion in Q2 FY16. The Company's revenue numbers exceeded analysts' forecasts of $11.94 billion.

During Q2 FY17, HP's gross margin of 19.2% declined 0.2 points on a y-o-y basis, driven primarily by strong Personal Systems growth and higher commodity costs in Personal Systems, partially offset by print margins. The Company's non-GAAP operating expenses of $1.4 billion were up 7% y-o-y. HP's net OI&E expense totaled $69 million for the reported quarter.

HP reported net income of $559 million in Q2 FY17 compared to net income of $629 million in Q2 FY16. The Company's GAAP diluted net earnings per share from continuing operations came in at $0.33, down compared to $0.38 in the prior year's same period and within the previously provided outlook of $0.32 to $0.35. HP's non-GAAP diluted net EPS was $0.40 for Q2 FY17, down from $0.41 in the prior year's period and within the previously provided outlook of $0.37 to $0.40. The Company's earnings results were a penny ahead of Wall Street's expectations of $0.39 per share.

Segment Results

For Q2 FY17, HP's Personal Systems' net revenue surged 10% on a y-o-y basis to $7.7 billion with the Company witnessing strong performance across both customer segments, with consumer revenue up 16% and commercial increasing 7% on a y-o-y basis. The segment's total units were up 5% with Notebooks units up 12% and Desktops units down 6%.

HP's printing revenue totaled $4.7 billion in Q2 FY17, up 2% on a y-o-y basis. The segment's Hardware units were up 4% y-o-y with Commercial hardware units up 6% and Consumer hardware units up 3%. Printing segment's supplies net revenue grew 2% in the reported quarter.

Asset management

HP's cash provided by operating activities in Q2 FY17 was $455 million and $1.2 billion on YTD basis. The Company's free cash flow was $380 million in the reported quarter and approximately $1.1 billion year-to-date. HP's dividend payment of $0.1327 per share in Q2 FY17 resulted in cash usage of $0.2 billion. HP also utilized $0.2 billion of cash during the quarter to repurchase approximately 13.3 million shares of common stock in the open market. The Company exited the reported quarter with $6.2 billion in gross cash, which includes cash and cash equivalents, short-term investments, and certain liquid long-term investments.

Outlook

For Q3 FY17, HP is forecasting GAAP diluted net EPS from continuing operations to be in the range of $0.36 to $0.40 and non-GAAP diluted net EPS to be in the band of $0.40 to $0.43.

For FY17, HP is estimating GAAP diluted net EPS from continuing operations to be in the range of $1.42 to $1.52, and it increased its non-GAAP diluted net EPS to be in the projected band of $1.59 to $1.66.

Stock Performance

HP Inc.'s share price finished yesterday's trading session at $17.76, slightly down 0.22%. A total volume of 12.53 million shares have exchanged hands, which was higher than the 3-month average volume of 10.39 million shares. The Company's stock price soared 1.54% in the last three months, 9.90% in the past six months, and 31.56% in the previous twelve months. Additionally, the stock rallied 19.68% since the start of the year. Shares of the Company have a PE ratio of 12.11 and have a dividend yield of 2.98%. The stock currently has a market cap of $29.98 billion.

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SOURCE: Pro-Trader Daily