HP Inc. Has Positive News for Investors

October 4, 2018
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Investors in HP Inc. (NYSE: HPQ) have good news to celebrate this week. In the final stages of a positive year, the company has made the announcement that it will have increased cash flow in 2019, allowing it to return money to shareholders in the form of dividends and stock buybacks.

Although HP has largely missed the headlines this year, it has been a solid performer without any major publicity. This latest news could reignite investor interest and attract new shareholders.

FY17 Results are an Indicator of Things to Come

At the end of its 2017 fiscal year, HP reported 8.28% growth in revenue, along with 7.98% growth in gross income. This came after a three-year streak of sales declines.

The company is positive that at the end of 2018, the growth trajectory will continue. A strong 2018 will lead to higher free cash flow for the following year. Chief Financial Officer Steve Fieler said this week that free cash flow for 2019 should be $3.7 Billion or higher. Between 50% and 75% will be returned to investors. Dividends will benefit investors directly, while stock buybacks will raise stock value.

This is positive news for all investors, especially long-term shareholders who were present during the period of decline from 2014 to 2016.

Fieler said in a statement that “FY18 has been a strong year for HP. In FY19 we will continue to execute against our core, growth, and future strategy, driving productivity improvements, and investing for the future to maximize shareholder value over the long term.”

Earnings per share for the beginning of 2019 could reach as high as $2.22, compared to $1.48 at the end of 2017.

HP Inc. Stock Price Growth in 2018

Investors looking for a promising tech stock with signs of growth should consider HP. The company has made a strong recovery since 2017, and stock value has steadily increased.

For the year to date, HP stock value has increased 24.04%. In the last three months, value has increased 14.55%. Helped in part by this week’s news, five-day growth is currently tracking at 1.68%.

Hewlett Packard is still priced low enough to be considered amongst other bargain stock. Continued strong performance could provide significant gains for investors in the next fiscal year.

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