HP (HPQ): Exploring Valuation Gaps as Share Momentum Remains Subdued

HP (HPQ) shares have been quietly drifting without any major headlines to drive excitement or concern. With no recent impactful events on the radar, investors may be watching for valuation shifts or fresh business updates in the coming weeks.

See our latest analysis for HP.

HP’s latest share price of $26.28 reflects a 2.86% gain over the last month, hinting at pockets of renewed interest despite a year-to-date slide. Long-term shareholders have seen the total return climb over 58% across five years, though the 12-month total shareholder return sits firmly in negative territory. Momentum appears subdued for now. As ever, solid execution or a shift in market sentiment could spark a turnaround.

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With HP shares trading below analyst targets and a nearly 47% intrinsic discount, some investors may wonder if this signals an undervalued entry point or if the market is simply reflecting tempered expectations for future growth.

Most Popular Narrative: 7.1% Undervalued

HP’s most widely followed narrative sees its fair value at $28.28, a modest premium to the $26.28 last close, suggesting room for gains if business trends persist. The rationale behind this view is that strong forward assumptions based on digital adoption and operational efficiency appear to outweigh sector headwinds for now.

Persistent structural cost reduction initiatives, including manufacturing diversification outside China, AI-enabled automation, and a $2B annualized savings target, are set to drive sustainable improvements in net margins and bottom-line earnings resilience. HP's focus on responsible innovation and sustainability, exemplified by significant recycled content in devices and advances toward net zero, aligns with growing enterprise and consumer preference for eco-friendly technology. This strengthens competitive positioning and supports revenue and margin growth over the long term.

Read the complete narrative.

Want to see the financial engine powering this narrative? The math features optimistic forecasts for future revenue, profit margins, and shrinking share count, all designed to justify that premium valuation. Discover which bold assumptions are pulling HP’s fair value higher. Read the full narrative to see the model’s hidden levers.

Result: Fair Value of $28.28 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

Story Continues

However, persistent declines in printing demand and rising competitive pricing could easily challenge HP’s recent improvements and reduce confidence in future growth projections.

Find out about the key risks to this HP narrative.

Build Your Own HP Narrative

If you see things differently, or you’re keen to dig into the numbers on your own terms, crafting your personal narrative takes only a few minutes. Do it your way

A great starting point for your HP research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include HPQ.

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