Overview of Hewlett Packard Enterprise (HPE) 3rd quarter 2021 earnings report
Category: Hewlett Packard Enterprise (HPE)
Date: 3 September 2021 Stock price of Hewlett Packard (HPE): $15.39 Market Capital of Hewlett Packard: $20.1 billion We take a look at the 3rd quarter 2021 earnings report of Hewlett Packard Enterprises (HPE) a global cloud platform service provider with a market capital of over $20 billion. For the quarter the group reported revenues of $16.67 billion and net income of $3.09 billion.
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We delivered a very impressive Q3 performance, marked by strong order growth, expanded margins and record free cash flow- Antonio Neri, president and CEO of Hewlett Packard Enterprise."
More About Hewlett Packard Enterprise
Hewlett Packard Enterprise is the global edge-to-cloud platform as-a-service company that helps organizations accelerate outcomes by unlocking value from all of their data, everywhere. Built on decades of reimagining the future and innovating to advance the way people live and work, HPE delivers unique, open and intelligent technology solutions, with a consistent experience across all clouds and edges, to help customers develop new business models, engage in new ways, and increase operational performance
Overview of Hewlett Packard's 3rd quarter 2021 earnings
Q3 2021 Financial Highlights:
- Orders: Strengthening demand accelerates growth, up strong double-digits from the prior-year period and year-to-date up 11% from the prior-year period
- Revenue: $6.9 billion, up 3% sequentially and in-line with Q3 outlook of normal sequential seasonality; up 1% from the prior-year period
- Intelligent Edge revenue: $867 million, up 27% from the prior-year period
- HPC & MCS revenue: $741 million, up 11% from the prior-year period
- Annualized revenue run-rate (ARR): $705 million, up 33% from the prior-year period
- Diluted net earnings per share (“EPS”):
- GAAP of $0.29, above the previously provided outlook of $0.04 to $0.10 per share
- Non-GAAP of $0.47, up 31% from the prior-year period and above the previously provided outlook of $0.38 to $0.44 per share
- Cash flow from operations year-to-date: $2.9 billion, up $1.4 billion from the prior-year period
- Free cash flow year-to-date: $1.5 billion, up $1.1 billion from the prior-year period Capital Returns:
- Declared a regular cash dividend of $0.12 per share, payable on October 6, 2021
- Reinstating share repurchase program and targeting share repurchases of up to $250 million in Q4 FY21
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Hewlett Packard's management commentary 3rd quarter 2021 earnings report
HOUSTON, Texas – September 2, 2021 – Hewlett Packard Enterprise (NYSE: HPE) today announced financial results for the third quarter, ended July 31, 2021.
“We delivered a very impressive Q3 performance, marked by strong order growth, expanded margins and record free cash flow,” said Antonio Neri, president and CEO of Hewlett Packard Enterprise. “I am pleased to see how our differentiated portfolio is resonating with the market, and our edge-to-cloud strategy is driving improved momentum across our businesses.”
“The impacts of the pandemic continue to accelerate the shift we predicted years ago to an edge-centric, cloudenabled and data-driven world,” he continued. “Now, more than ever, companies need secure connectivity, faster insights from data, and a cloud experience everywhere. We expect those trends to continue. Digital transformation is no longer a priority but a strategic imperative.” “We are once again raising our full-year guidance to reflect the continued momentum in the demand environment and our strong execution,” said Tarek Robbiati, EVP and CFO of Hewlett Packard Enterprise. “This marks the fourth increase in our outlook since our Securities Analyst Meeting in October 2020.”
“We delivered a very impressive Q3 performance, marked by strong order growth, expanded margins and record free cash flow,” said Antonio Neri, president and CEO of Hewlett Packard Enterprise. “I am pleased to see how our differentiated portfolio is resonating with the market, and our edge-to-cloud strategy is driving improved momentum across our businesses.”
“The impacts of the pandemic continue to accelerate the shift we predicted years ago to an edge-centric, cloudenabled and data-driven world,” he continued. “Now, more than ever, companies need secure connectivity, faster insights from data, and a cloud experience everywhere. We expect those trends to continue. Digital transformation is no longer a priority but a strategic imperative.” “We are once again raising our full-year guidance to reflect the continued momentum in the demand environment and our strong execution,” said Tarek Robbiati, EVP and CFO of Hewlett Packard Enterprise. “This marks the fourth increase in our outlook since our Securities Analyst Meeting in October 2020.”
Outlook:
- Fourth quarter Fiscal 2021: Estimates GAAP diluted net EPS to be in the range of $0.14 to $0.22 and non-GAAP diluted net EPS to be in the range of $0.44 to $0.52
- Fiscal 2021: Raises GAAP diluted net EPS outlook to $0.80 to $0.88 and non-GAAP diluted net EPS outlook to $1.88 to $1.96
- Fiscal 2021 free cash flow : Raises free cash flow guidance to $1.5 to $1.7 billion
Hewlett Packard (HPE) stock price chart over the last 5 years
The image below shows the stock price history of Hewlett Packard over the last 5 years. And its not been a good time for Hewlett Packard stockholders with the stock decreasing by -33.2% over the last 5 years.
The stock of Hewlett is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Hewlett Packard stock is positive at this point in time.
The stock of Hewlett is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Hewlett Packard stock is positive at this point in time.
Latest stock valuation of Hewlett Packard
So what is Hewlett Packard stock worth based on their 3rd quarter 2021 earnings report? Based on their earnings report our valuation model provides a target price (full value price) for Hewlett Packard at $17.40 a stock
We therefore believe the stock of Hewlett Packard is undervalued at its current price of $15.39
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $17.40 thus a good entry point into Hewlett Packard would be at $15.70 or below.
We expect the stock of Hewlett Packard to kick up from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is undervalued
We therefore believe the stock of Hewlett Packard is undervalued at its current price of $15.39
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price), which in this case is $17.40 thus a good entry point into Hewlett Packard would be at $15.70 or below.
We expect the stock of Hewlett Packard to kick up from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is undervalued
Next earnings release of Hewlett Packard
It is expected that Hewlett Packard will release their 4th quarter 2021 earnings report
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