HP Inc., FCFF calculation

USD $ in millions

	12 months ended	Oct 31, 2018	Oct 31, 2017	Oct 31, 2016	Oct 31, 2015	Oct 31, 2014	Oct 31, 2013
	Net earnings
	Net noncash charges
	Changes in operating assets and liabilities, net of acquisitions
	Net cash provided by operating activities
	Interest expense paid, net of tax¹
	Investment in property, plant and equipment
	Proceeds from sale of property, plant and equipment
	Purchase of assets under capital leases
	Free cash flow to the firm (FCFF)

Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the HP Inc.’s suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	HP Inc.’s FCFF increased from 2016 to 2017 and from 2017 to 2018.

HP Inc., interest paid, net of tax calculation

USD $ in millions

	12 months ended	Oct 31, 2018	Oct 31, 2017	Oct 31, 2016	Oct 31, 2015	Oct 31, 2014	Oct 31, 2013
	Effective Income Tax Rate (EITR)

	EITR¹
	Interest Paid, Net of Tax
	Interest expense paid, before tax
	Less: Interest expense paid, tax²
	Interest expense paid, net of tax

2018 Calculations

² Interest expense paid, tax = Interest expense paid × EITR
= hidden × hidden = hidden

HP Inc., current EV/FCFF calculation, comparison to benchmarks

Selected Financial Data (USD $ in millions)
Enterprise value (EV)
Free cash flow to the firm (FCFF)
Ratio
EV/FCFF
Benchmarks
EV/FCFF, Competitors
Apple Inc.
Applied Materials Inc.
Broadcom Inc.
Cisco Systems Inc.
Intel Corp.
NVIDIA Corp.
Qualcomm Inc.
Texas Instruments Inc.
EV/FCFF, Sector
Technology Hardware & Equipment
EV/FCFF, Industry
Technology

If company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.

Otherwise, if company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

HP Inc., historical EV/FCFF calculation, comparison to benchmarks

		Oct 31, 2018	Oct 31, 2017	Oct 31, 2016	Oct 31, 2015	Oct 31, 2014	Oct 31, 2013
	Selected Financial Data (USD $ in millions)
	Enterprise value (EV)¹
	Free cash flow to the firm (FCFF)²
	Ratio
	EV/FCFF³
	Benchmarks
	EV/FCFF, Competitors
	Apple Inc.
	Applied Materials Inc.
	Broadcom Inc.
	Cisco Systems Inc.
	Intel Corp.
	NVIDIA Corp.
	Qualcomm Inc.
	Texas Instruments Inc.
	EV/FCFF, Sector
	Technology Hardware & Equipment
	EV/FCFF, Industry
	Technology

2018 Calculations

³ EV/FCFF = EV ÷ FCFF
= hidden ÷ hidden = hidden

Ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	HP Inc.’s EV/FCFF ratio increased from 2016 to 2017 but then declined significantly from 2017 to 2018.

	HP Inc.	Other companies (not purchased previously)
Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis
Financial Reporting Quality

	All companies
Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Economic Value Added (EVA)
Long-term Trends
Analysis
Financial Reporting Quality

HP Inc. (HPQ)

Enterprise Value to FCFF (EV/FCFF)