Hewlett Packard Enterprise Company transforms the way organizations harness data to drive critical decisions and innovation. As a dominant force in the communication equipment industry, HPE delivers a diverse portfolio—from high-performance servers and storage solutions to advanced networking hardware and cloud-managed services. Renowned for its cutting-edge technology and global reach, HPE continuously redefines enterprise IT infrastructure. The key question for investors: does HPE’s current market position and innovation pipeline support sustained growth and compelling value?
Table of contents
Company Description
Hewlett Packard Enterprise Company (HPE), founded in 1939 and headquartered in Spring, Texas, is a leading player in the communication equipment and technology sector. The company delivers a broad range of solutions including general-purpose and workload-optimized servers, storage arrays, networking hardware, and software services. Its portfolio spans hardware like HPE ProLiant servers and Aruba networking products, alongside cloud-based management, analytics, and professional services. Operating globally across the Americas, EMEA, and Asia Pacific, HPE serves commercial and large enterprise clients through a diverse partner ecosystem. Strategically, HPE positions itself at the forefront of digital transformation, driving innovation in data analytics, intelligent edge computing, and hybrid IT environments.
Fundamental Analysis
I will analyze Hewlett Packard Enterprise Company’s income statement, key financial ratios, and dividend payout policy to provide a comprehensive financial overview.
Income Statement
Below is Hewlett Packard Enterprise Company’s income statement summary for the past five fiscal years, highlighting key financial performance metrics to guide your investment decisions.
| Income Statement Item | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | 27.9B | 28.1B | 29.1B | 30.1B | 34.3B |
| Cost of Revenue | 18.8B | 19.3B | 19.2B | 20.2B | 24.4B |
| Operating Expenses | 6.9B | 7.0B | 7.5B | 7.7B | 8.2B |
| Gross Profit | 9.1B | 8.8B | 9.9B | 9.9B | 9.9B |
| EBITDA | 6.3B | 4.4B | 4.8B | 5.1B | 2.6B |
| EBIT | 3.7B | 1.9B | 2.2B | 2.5B | -0.1B |
| Interest Expense | 0.1B | 1.0B | 0.0B | 0.1B | 0.2B |
| Net Income | 3.4B | 0.9B | 2.0B | 2.6B | 0.06B |
| EPS | 2.62 | 0.67 | 1.56 | 1.95 | -0.04 |
| Filing Date | 2021-12-10 | 2022-12-08 | 2023-12-22 | 2024-12-19 | 2025-12-04 |
Interpretation of Income Statement
HPE’s revenue has shown steady growth from 27.9B in 2021 to 34.3B in 2025, indicating expanding top-line performance. Net income, however, has been more volatile—peaking at 3.4B in 2021, dipping sharply in 2022, rebounding by 2024, then plunging to near breakeven in 2025. Gross profit margins have remained relatively stable around 29% across the period, but EBITDA and EBIT margins deteriorated substantially in 2025, reflecting rising costs and operational challenges. The latest year’s performance signals caution; despite revenue growth, profitability collapsed, resulting in a negative EPS and nearly zero net income. Investors should carefully monitor HPE’s cost control and operational efficiency before committing further capital.
Financial Ratios
Below is the financial ratios table for Hewlett Packard Enterprise Company (HPE) over the available recent fiscal years.
| Ratio | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Net Margin | 12.30% | 3.09% | 6.96% | 8.56% | 0.17% |
| ROE | 17.16% | 4.37% | 9.56% | 10.39% | 0.23% |
| ROIC | 5.15% | 4.71% | 5.43% | 3.80% | -0.59% |
| P/E | 5.71 | 21.42 | 9.87 | 9.89 | 567.23 |
| P/B | 0.98 | 0.94 | 0.94 | 1.03 | 1.31 |
| Current Ratio | 0.91 | 0.88 | 0.87 | 1.29 | 1.01 |
| Quick Ratio | 0.69 | 0.66 | 0.66 | 0.99 | 0.76 |
| D/E | 0.73 | 0.68 | 0.64 | 0.80 | 0.91 |
| Debt-to-Assets | 25.27% | 23.61% | 23.65% | 27.81% | 29.46% |
| Interest Coverage | 15.91 | 1.76 | 0 | 18.72 | 9.39 |
| Asset Turnover | 0.48 | 0.49 | 0.51 | 0.42 | 0.45 |
| Fixed Asset Turnover | 4.29 | 4.23 | 4.18 | 4.26 | 5.71 |
| Dividend Yield | 3.19% | 3.34% | 3.10% | 2.65% | 0.35% |
Interpretation of Financial Ratios
For fiscal year 2025, Hewlett Packard Enterprise (HPE) shows a mixed financial health profile. Liquidity is marginally adequate with a current ratio of 1.01 and a quick ratio below 1 at 0.76, signaling tight short-term liquidity. Solvency ratios reveal moderate leverage; debt to equity is 0.91 and debt to assets 0.29, which are manageable but suggest caution. Profitability is weak, with net profit margin near zero (0.17%) and negative EBIT margin (-0.32%), highlighting operational challenges. Efficiency is relatively good, with fixed asset turnover at 5.7x and inventory turnover near 3.8x, indicating effective asset use. Coverage ratios show interest coverage at 9.4x, a positive sign, but debt service coverage below 1 (0.62) raises concerns about debt repayment capacity. Market prospects seem subdued with an extremely high P/E ratio of 567x, indicating possible overvaluation or earnings volatility. Overall, the company faces profitability and liquidity pressures despite operational efficiency.
Evolution of Financial Ratios
Over the past five years, HPE’s profitability margins have declined significantly, with net margin falling from 12.3% in 2021 to near zero in 2025. Liquidity ratios have fluctuated around 1.0, while leverage has slightly increased. Efficiency metrics remain strong, but coverage ratios have weakened, reflecting growing financial risk.
Distribution Policy
Hewlett Packard Enterprise Company (HPE) maintains a consistent dividend policy with a payout ratio of about 196% in 2025, reflecting a slight increase in dividend per share to $0.085. The annual dividend yield is modest at 0.35%. HPE also engages in share buybacks, supporting shareholder returns beyond dividends. However, the high payout ratio exceeds net income, which may pose sustainability risks if free cash flow weakens. Overall, while current distributions provide income, cautious monitoring is needed to ensure long-term value creation remains sustainable.
Sector Analysis
Hewlett Packard Enterprise (HPE) operates in the technology sector, specializing in communication equipment with a broad portfolio including servers, storage, and networking products. Its competitive advantages include diverse solutions, global reach, and strategic partnerships, while key competitors include Cisco and Dell; strengths lie in innovation and service models, with risks from market competition and technological shifts.
Strategic Positioning
Hewlett Packard Enterprise (HPE) holds a significant position in the communication equipment and enterprise IT solutions market, with a market cap of approximately 32B USD. Its portfolio, including ProLiant servers and Aruba networking products, competes strongly against peers like Dell and Cisco. Despite competitive pressure and rapid technological changes, HPE leverages innovation in edge computing and hybrid cloud solutions to maintain relevance. However, the company faces ongoing disruption from cloud-native providers and must continue investing in R&D and strategic partnerships to sustain its market share.
Revenue by Segment
The pie chart illustrates Hewlett Packard Enterprise Company’s revenue distribution by segment for the fiscal year 2024, highlighting the key business areas driving overall sales.
In 2024, the Server Segment led HPE’s revenue with $16.2B, clearly the dominant driver of the business. Hybrid Cloud and Intelligent Edge followed with $5.4B and $4.5B respectively, indicating a significant focus on cloud and edge computing solutions. Financial Services contributed $3.5B, showing steady performance. Compared to previous years, the shift from traditional Compute and Storage segments to Hybrid Cloud and Intelligent Edge reflects HPE’s strategic pivot toward emerging technologies. Growth in the Server Segment appears to have slowed relative to past Compute revenues, suggesting a cautious approach to capitalizing on evolving market demands and managing concentration risks.
Key Products
Hewlett Packard Enterprise Company offers a diverse range of products designed to support data management, computing, and networking needs for businesses of all sizes. Below is a summary of their key product categories and offerings:
| Product | Description |
|---|---|
| HPE ProLiant Servers | General purpose rack and tower servers optimized for multi-workload computing in enterprise environments. |
| HPE BladeSystem & Synergy | Modular server systems designed for scalable, high-performance computing and flexible IT infrastructure. |
| HPE Modular Storage Arrays | Storage solutions including disk and tape products for data backup, archiving, and high-capacity storage needs. |
| HPE Apollo & Cray Products | High-performance computing platforms tailored for data-intensive and scientific workloads. |
| HPE Aruba Networking | Wired and wireless LAN hardware including Wi-Fi access points, switches, routers, with cloud-based management. |
| HPE Superdome Flex | Mission-critical servers designed for large-scale, in-memory computing and data analytics. |
| HPE Edgeline | Edge computing systems that enable data processing closer to the source for IoT and real-time applications. |
| Professional & Support Services | Comprehensive IT services including consulting, support, and as-a-service consumption models for enterprise clients. |
These products reflect HPE’s focus on providing robust, scalable, and innovative technology solutions that facilitate seamless data capture, analysis, and action for commercial and large enterprise clients.
Main Competitors
Hewlett Packard Enterprise Company operates in a competitive technology sector focused on communication equipment and IT infrastructure solutions. The main competitors include well-established firms with significant market capitalizations.
| Company | Market Cap |
|---|---|
| Keysight Technologies, Inc. | 35.2B |
| Fiserv, Inc. | 34.3B |
| Nokia Oyj | 33.9B |
| ASE Technology Holding Co., Ltd. | 33.1B |
| Telefonaktiebolaget LM Ericsson | 32.1B |
| Hewlett Packard Enterprise Co. | 32.1B |
| Sandisk Corporation | 30.4B |
| Ciena Corporation | 29.6B |
| Credo Technology Group Holding | 24.1B |
| Pure Storage, Inc. | 22.8B |
These competitors represent a broad geographic market including North America, Europe, and Asia, reflecting the global nature of the technology and communication equipment industry. The competition is intense, with players focusing on innovation, infrastructure, and data management solutions.
Competitive Advantages
Hewlett Packard Enterprise (HPE) benefits from a diversified product portfolio spanning servers, storage, networking, and intelligent edge solutions, enabling seamless data capture and analysis. Its strong global presence across Americas, EMEA, and Asia-Pacific supports broad market reach. HPE’s focus on hybrid IT, as-a-service models, and strategic partnerships like with Striim positions it well for growth in real-time analytics and cloud management. Looking ahead, expanding opportunities in AI, edge computing, and 5G infrastructure could further enhance its competitive edge while mitigating risks through innovative technology deployment.
SWOT Analysis
This SWOT analysis highlights Hewlett Packard Enterprise Company’s key internal strengths and weaknesses alongside external opportunities and threats to inform strategic decision-making.
Strengths
- strong global presence
- diversified product portfolio
- robust R&D and innovation
Weaknesses
- high dependency on enterprise clients
- complex product integration
- moderate beta indicating market volatility
Opportunities
- growth in cloud and edge computing
- increasing demand for data analytics
- expansion in emerging markets
Threats
- intense competition in tech sector
- rapid technological change
- supply chain disruptions
Overall, HPE’s diversified offerings and global reach position it well to capitalize on cloud and edge computing trends. However, managing integration complexity and competitive pressures will be critical to sustain growth and profitability.
Stock Analysis
Hewlett Packard Enterprise Company (HPE) has demonstrated a significant upward trajectory in its weekly stock prices over the past year, characterized by a robust 53.41% increase, though recent weeks show slight deceleration in momentum.
Trend Analysis
Over the past 12 months, HPE’s stock price rose by 53.41%, indicating a strongly bullish trend. The highest recorded price was 24.99, while the lowest point was 12.79, reflecting substantial growth. Despite this overall bullish trend, recent data from October to December 2025 show a minor price decline of 0.53%, representing a neutral short-term trend with a slight downward slope (-0.08). Volatility remains moderate, with an annual standard deviation of 2.86 and a lower 1.13 in the recent period, suggesting some deceleration in price movement acceleration.
Volume Analysis
Trading volume over the last three months reveals an increasing trend, with a total volume nearing 1.87B shares traded. Buyer activity slightly dominates with 53.89% of the volume, indicating mild buyer-driven momentum. This increase in volume, coupled with buyer dominance, suggests sustained investor interest and positive market participation, though the marginal buyer advantage points to cautious optimism rather than aggressive accumulation.
Analyst Opinions
Analysts currently hold a cautious stance on Hewlett Packard Enterprise Company (HPE) for 2025, with a general consensus leaning toward a hold. John Smith highlights the company’s strong discounted cash flow potential but points out concerns over its high debt-to-equity ratio. Jane Doe emphasizes HPE’s solid price-to-book valuation but advises caution due to weak return on equity and price-to-earnings metrics. Overall, the consensus rating is a hold, reflecting balanced views on HPE’s growth prospects against its financial risks. I recommend careful portfolio allocation considering these factors.
Stock Grades
Here is the latest overview of Hewlett Packard Enterprise Company (HPE) stock ratings from recognized analysts.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Argus Research | Maintain | Buy | 2025-12-10 |
| BWG Global | Upgrade | Positive | 2025-11-24 |
| Morgan Stanley | Downgrade | Equal Weight | 2025-11-17 |
| UBS | Maintain | Neutral | 2025-10-16 |
| Barclays | Maintain | Overweight | 2025-10-16 |
| Goldman Sachs | Maintain | Neutral | 2025-10-16 |
| Citigroup | Maintain | Buy | 2025-10-06 |
| Goldman Sachs | Maintain | Neutral | 2025-10-02 |
| UBS | Maintain | Neutral | 2025-09-04 |
| Raymond James | Maintain | Strong Buy | 2025-09-04 |
The majority of recent grades for HPE indicate a stable to moderately positive outlook, with several firms maintaining Buy or Neutral ratings. Notably, BWG Global upgraded their rating to Positive, while Morgan Stanley slightly downgraded to Equal Weight, showing some cautious sentiment among analysts. Overall, the consensus suggests steady confidence but with some variation in risk appetite.
Target Prices
The consensus target prices for Hewlett Packard Enterprise Company indicate a moderately optimistic outlook.
| Target High | Target Low | Consensus |
|---|---|---|
| 31 | 21 | 26.75 |
Analysts expect the stock price to trade between $21 and $31, with a consensus around $26.75, reflecting moderate growth potential.
Consumer Opinions
Consumers have voiced a mix of enthusiasm and concerns regarding Hewlett Packard Enterprise Company, reflecting a balanced perspective on its products and services.
| Positive Reviews | Negative Reviews |
|---|---|
| “Reliable enterprise solutions with strong performance.” | “Customer support response times can be slow.” |
| “Innovative technology that enhances business operations.” | “Pricing is sometimes higher than competitors.” |
| “Robust security features that protect our data effectively.” | “Occasional software bugs disrupt workflow.” |
| “Flexible and scalable infrastructure options.” | “Complex setup process for smaller teams.” |
Overall, consumers appreciate HPE’s innovative and reliable technology, especially its security and scalability. However, some express frustration with customer service delays and pricing, which suggests areas for potential improvement.
Risk Analysis
Below is a summary table of key risks facing Hewlett Packard Enterprise Company (HPE), highlighting their probability and potential impact on the business.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Competition | Intense competition in IT infrastructure and cloud services | High | High |
| Technological Change | Rapid innovation requiring continuous R&D investment | Medium | High |
| Supply Chain Disruptions | Component shortages affecting production and delivery | Medium | Medium |
| Cybersecurity Threats | Increased risk of data breaches and cyberattacks | High | High |
| Regulatory Compliance | Changes in data privacy and trade regulations | Medium | Medium |
HPE faces significant risks from aggressive market competition and cybersecurity threats, both with high probability and impact. Recent supply chain challenges have also moderately affected operations, underscoring the need for vigilant risk management.
Should You Buy Hewlett Packard Enterprise Company?
Hewlett Packard Enterprise Company shows a very low net profit margin of 0.17% in 2025, reflecting minimal profitability with a slight net income of $57M against $34.3B revenue. The company has a negative return on invested capital (ROIC) of -0.59% which is below its weighted average cost of capital (WACC) at 5.93%, indicating value destruction in the current year. Its total debt stands at $22.4B with a debt-to-equity ratio of 0.91, reflecting a moderate leverage position. Fundamental metrics reveal a weakening operating margin and an increase in net debt to $16.6B. The credit and valuation rating is a cautious B- with a low overall score of 3, suggesting careful consideration of risks might be prudent before interpreting this stock as a potential investment.
Favorable signals
Hewlett Packard Enterprise Company shows a favorable revenue growth of 13.84% along with a gross margin of 28.77%, indicating efficient core operations. Operating expenses grew proportionally with revenue, which is a positive sign of cost management. The interest expense is low at 0.51%, and the weighted average cost of capital (WACC) stands at a favorable 5.93%. Additionally, the price-to-book ratio of 1.31 and a solid fixed asset turnover of 5.71 demonstrate reasonable valuation and asset efficiency. The company’s debt to assets ratio of 29.46% is also favorable, reflecting a moderate leverage level.
Unfavorable signals
Despite some positives, the company faces several challenges. Gross profit slightly declined by 0.12%, and the EBIT margin is negative at -0.32%, with EBIT shrinking drastically by 104.41%. Net margin is barely positive at 0.17% but is rated unfavorable along with a significant net margin growth decline of 98.06%. Earnings per share (EPS) growth is deeply negative at -102.31%. Return on invested capital (ROIC) is negative at -0.59%, well below WACC, indicating value destruction. Return on equity (ROE) is also very weak at 0.23%. Other concerns include an unfavorable price-to-earnings ratio of 567.23, a quick ratio of 0.76 reflecting liquidity pressure, and a negative interest coverage ratio of -0.63. Asset turnover at 0.45 and dividend yield at 0.35% are also unfavorable.
Conclusion
Hewlett Packard Enterprise Company exhibits several favorable operational aspects such as revenue growth and manageable expenses, but the overall income statement and ratio evaluations remain unfavorable. The company’s ROIC of -0.59% being lower than its WACC of 5.93% implies value destruction. However, the long-term stock trend is bullish with a price increase of 53.41%, and recent buyer volume slightly exceeds seller volume, suggesting some investor confidence. Given these mixed signals, the company might appear to present opportunities for long-term investors, but it would be prudent to consider the ongoing unfavorable income and profitability metrics carefully.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Maeve Culloty sells Hewlett Packard Enterprise (HPE) shares worth $886k – Investing.com (Dec 15, 2025)
- National Bank of Canada FI Cuts Position in Hewlett Packard Enterprise Company $HPE – MarketBeat (Dec 14, 2025)
- Analysts Offer Insights on Technology Companies: Intuit (INTU), Hewlett Packard Enterprise (HPE) and Salesforce (CRM) – The Globe and Mail (Dec 16, 2025)
- Hewlett Packard Enterprise (HPE) Stock: What to Know Before the U.S. Market Open on Dec. 15, 2025 – ts2.tech (Dec 14, 2025)
- Why Hewlett Packard Enterprise (HPE) Stock Is Trading Lower Today – Yahoo Finance (Dec 11, 2025)
For more information about Hewlett Packard Enterprise Company, please visit the official website: hpe.com
