Return on Equity (ROE)
since 2005
Calculation
HP Inc., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net earnings (loss)1 | ÷ | Total HP stockholders’ equity (deficit)1 | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2018 | — | = | 100 | × | 5,327) | ÷ | (639) |
| Oct 31, 2017 | — | = | 100 | × | 2,526) | ÷ | (3,408) |
| Oct 31, 2016 | — | = | 100 | × | 2,496) | ÷ | (3,889) |
| Oct 31, 2015 | 16.40% | = | 100 | × | 4,554) | ÷ | 27,768) |
| Oct 31, 2014 | 18.75% | = | 100 | × | 5,013) | ÷ | 26,731) |
| Oct 31, 2013 | 18.75% | = | 100 | × | 5,113) | ÷ | 27,269) |
| Oct 31, 2012 | -56.38% | = | 100 | × | (12,650) | ÷ | 22,436) |
| Oct 31, 2011 | 18.31% | = | 100 | × | 7,074) | ÷ | 38,625) |
| Oct 31, 2010 | 21.66% | = | 100 | × | 8,761) | ÷ | 40,449) |
| Oct 31, 2009 | 18.91% | = | 100 | × | 7,660) | ÷ | 40,517) |
| Oct 31, 2008 | 21.39% | = | 100 | × | 8,329) | ÷ | 38,942) |
| Oct 31, 2007 | 18.85% | = | 100 | × | 7,264) | ÷ | 38,526) |
| Oct 31, 2006 | 16.25% | = | 100 | × | 6,198) | ÷ | 38,144) |
| Oct 31, 2005 | 6.45% | = | 100 | × | 2,398) | ÷ | 37,176) |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).
1 US$ in millions
The financial trajectory between 2005 and 2018 is characterized by an initial period of growth, a severe volatility event in 2012, and a subsequent period of earnings recovery coupled with a significant erosion of stockholders' equity.
- Earnings Performance
- Net earnings exhibited a steady upward trend from 2005 to 2010, rising from 2,398 million USD to a peak of 8,761 million USD. This growth phase was interrupted by a substantial net loss of 12,650 million USD in 2012. Following this trough, earnings rebounded to approximately 5 billion USD by 2013 and remained relatively stable, ending at 5,327 million USD in 2018.
- Equity Position
- Stockholders' equity remained stable and grew moderately from 37,176 million USD in 2005 to 40,449 million USD in 2010. However, a sharp decline began in 2012, falling to 22,436 million USD. This downward trend accelerated, resulting in a stockholders' deficit beginning in 2016 at -3,889 million USD. While the deficit narrowed to -639 million USD by 2018, the equity base remained significantly impaired compared to historical levels.
- Return on Equity (ROE) Analysis
- ROE improved consistently from 6.45% in 2005 to a high of 21.66% in 2010. The 2012 net loss triggered a precipitous drop to -56.38%. Although ROE stabilized between 16.40% and 18.75% from 2013 to 2015, the metric is not reported for the 2016-2018 period. This absence coincides with the transition of stockholders' equity into a deficit, which renders standard ROE calculations non-representative of operational performance.
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Comparison to Competitors
HP Inc., ROE, long-term trends, comparison to competitors
| HP Inc. | Apple Inc. | Arista Networks Inc. | Cisco Systems Inc. | Dell Technologies Inc. | Lumentum Holdings Inc. | Super Micro Computer Inc. | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2018 | — | 55.56% | 15.31% | 0.25% | — | 26.79% | 5.47% |
| Oct 31, 2017 | — | 36.07% | 25.46% | 14.53% | — | -16.56% | 8.64% |
| Oct 31, 2016 | — | 35.62% | 16.63% | 16.89% | — | 1.87% | 9.99% |
| Oct 31, 2015 | 16.40% | 44.74% | 15.37% | 15.04% | — | -0.89% | 16.46% |
| Oct 31, 2014 | 18.75% | 35.42% | 15.63% | 13.86% | — | — | 11.55% |
| Oct 31, 2013 | 18.75% | 29.98% | — | 16.89% | — | — | 5.70% |
| Oct 31, 2012 | -56.38% | 35.30% | — | 15.68% | — | — | 8.82% |
| Oct 31, 2011 | 18.31% | 33.83% | — | 13.74% | — | — | 14.00% |
| Oct 31, 2010 | 21.66% | 29.32% | — | 17.55% | — | — | 11.98% |
| Oct 31, 2009 | 18.91% | 20.49% | — | 15.87% | — | — | 9.02% |
| Oct 31, 2008 | 21.39% | 22.99% | — | 23.44% | — | — | 16.74% |
| Oct 31, 2007 | 18.85% | 24.06% | — | 23.29% | — | — | 16.69% |
| Oct 31, 2006 | 16.25% | 19.92% | — | 23.34% | — | — | — |
| Oct 31, 2005 | 6.45% | 17.88% | — | 24.77% | — | — | — |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).
Comparison to Sector (Technology Hardware & Equipment)
HP Inc., ROE, long-term trends, comparison to sector (technology hardware & equipment)
| HP Inc. | Technology Hardware & Equipment | |
|---|---|---|
| Oct 31, 2018 | — | 39.07% |
| Oct 31, 2017 | — | 28.71% |
| Oct 31, 2016 | — | 29.20% |
| Oct 31, 2015 | 16.40% | 34.61% |
| Oct 31, 2014 | 18.75% | 28.07% |
| Oct 31, 2013 | 18.75% | 25.70% |
| Oct 31, 2012 | -56.38% | 29.32% |
| Oct 31, 2011 | 18.31% | 26.14% |
| Oct 31, 2010 | 21.66% | 23.63% |
| Oct 31, 2009 | 18.91% | 17.78% |
| Oct 31, 2008 | 21.39% | 23.25% |
| Oct 31, 2007 | 18.85% | 23.52% |
| Oct 31, 2006 | 16.25% | 22.33% |
| Oct 31, 2005 | 6.45% | 23.09% |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).
Comparison to Industry (Information Technology)
HP Inc., ROE, long-term trends, comparison to industry (information technology)
| HP Inc. | Information Technology | |
|---|---|---|
| Oct 31, 2018 | — | 30.23% |
| Oct 31, 2017 | — | 23.19% |
| Oct 31, 2016 | — | 23.00% |
| Oct 31, 2015 | 16.40% | 25.97% |
| Oct 31, 2014 | 18.75% | 25.43% |
| Oct 31, 2013 | 18.75% | 24.73% |
| Oct 31, 2012 | -56.38% | 26.09% |
| Oct 31, 2011 | 18.31% | 29.03% |
| Oct 31, 2010 | 21.66% | 27.62% |
| Oct 31, 2009 | 18.91% | 20.05% |
| Oct 31, 2008 | 21.39% | 25.24% |
| Oct 31, 2007 | 18.85% | 23.67% |
| Oct 31, 2006 | 16.25% | 22.58% |
| Oct 31, 2005 | 6.45% | 21.92% |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31), 10-K (reporting date: 2012-10-31), 10-K (reporting date: 2011-10-31), 10-K (reporting date: 2010-10-31), 10-K (reporting date: 2009-10-31), 10-K (reporting date: 2008-10-31), 10-K (reporting date: 2007-10-31), 10-K (reporting date: 2006-10-31), 10-K (reporting date: 2005-10-31).