Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
HP Inc., current price multiples
| HP Inc. | Apple Inc. | Arista Networks Inc. | Cisco Systems Inc. | Super Micro Computer Inc. | ||
|---|---|---|---|---|---|---|
| Selected Financial Data | ||||||
| Current share price (P) | $18.09 | |||||
| No. shares of common stock outstanding | 1,481,913,639 | |||||
| Growth rate (g) | 17.94% | |||||
| Earnings per share (EPS) | $3.59 | |||||
| Next year expected EPS | $4.24 | |||||
| Operating profit per share | $2.74 | |||||
| Sales per share | $39.46 | |||||
| Book value per share (BVPS) | $-0.43 | |||||
| Valuation Ratios (Price Multiples) | ||||||
| Price to earnings (P/E) | 5.03 | 27.05 | 39.66 | 15.44 | 68.82 | |
| Price to next year expected earnings | 4.27 | 14.33 | 31.67 | 13.62 | 60.34 | |
| Price-earnings-growth (PEG) | 0.28 | 0.30 | 1.57 | 1.15 | 4.90 | |
| Price to operating profit (P/OP) | 6.60 | 22.95 | 36.67 | 12.96 | 57.86 | |
| Price to sales (P/S) | 0.46 | 6.84 | 14.12 | 3.42 | 6.18 | |
Based on: 10-K (reporting date: 2018-10-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
HP Inc., historical price multiples
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).
| Valuation ratio | Description | The company |
|---|---|---|
| P/E ratio | The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. | HP Inc. P/E ratio increased from 2016 to 2017 but then decreased significantly from 2017 to 2018. |
| P/OP ratio | Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. | HP Inc. P/OP ratio increased from 2016 to 2017 but then slightly decreased from 2017 to 2018 not reaching 2016 level. |
| P/S ratio | An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. | HP Inc. P/S ratio increased from 2016 to 2017 but then slightly decreased from 2017 to 2018 not reaching 2016 level. |
Price to Earnings (P/E)
HP Inc., historical P/E calculation, comparison to benchmarks
| Oct 31, 2018 | Oct 31, 2017 | Oct 31, 2016 | Oct 31, 2015 | Oct 31, 2014 | Oct 31, 2013 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,553,494,507 | 1,645,228,387 | 1,705,451,042 | 1,791,848,366 | 1,834,081,993 | 1,908,777,048 | |
| Selected Financial Data (US$) | |||||||
| Net earnings (in millions) | 5,327) | 2,526) | 2,496) | 4,554) | 5,013) | 5,113) | |
| Earnings per share (EPS)2 | 3.43 | 1.54 | 1.46 | 2.54 | 2.73 | 2.68 | |
| Share price1, 3 | 22.29 | 20.74 | 15.51 | 12.26 | 39.82 | 28.07 | |
| Valuation Ratio | |||||||
| P/E ratio4 | 6.50 | 13.51 | 10.60 | 4.82 | 14.57 | 10.48 | |
| Benchmarks | |||||||
| P/E Ratio, Competitors5 | |||||||
| Apple Inc. | 16.07 | — | — | — | — | — | |
| Arista Networks Inc. | — | — | — | — | — | — | |
| Cisco Systems Inc. | 1,964.84 | — | — | — | — | — | |
| Super Micro Computer Inc. | 24.33 | — | — | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
EPS = Net earnings ÷ No. shares of common stock outstanding
= 5,327,000,000 ÷ 1,553,494,507 = 3.43
3 Closing price as at the filing date of HP Inc. Annual Report.
4 2018 Calculation
P/E ratio = Share price ÷ EPS
= 22.29 ÷ 3.43 = 6.50
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/E ratio | The P/E ratio tells analyst how much an investor in common stock pays per dollar of current earnings. | HP Inc. P/E ratio increased from 2016 to 2017 but then decreased significantly from 2017 to 2018. |
Price to Operating Profit (P/OP)
HP Inc., historical P/OP calculation, comparison to benchmarks
| Oct 31, 2018 | Oct 31, 2017 | Oct 31, 2016 | Oct 31, 2015 | Oct 31, 2014 | Oct 31, 2013 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,553,494,507 | 1,645,228,387 | 1,705,451,042 | 1,791,848,366 | 1,834,081,993 | 1,908,777,048 | |
| Selected Financial Data (US$) | |||||||
| Earnings from operations (in millions) | 4,064) | 3,519) | 3,549) | 5,471) | 7,185) | 7,131) | |
| Operating profit per share2 | 2.62 | 2.14 | 2.08 | 3.05 | 3.92 | 3.74 | |
| Share price1, 3 | 22.29 | 20.74 | 15.51 | 12.26 | 39.82 | 28.07 | |
| Valuation Ratio | |||||||
| P/OP ratio4 | 8.52 | 9.70 | 7.45 | 4.02 | 10.16 | 7.51 | |
| Benchmarks | |||||||
| P/OP Ratio, Competitors5 | |||||||
| Apple Inc. | 13.49 | — | — | — | — | — | |
| Arista Networks Inc. | — | — | — | — | — | — | |
| Cisco Systems Inc. | 17.56 | — | — | — | — | — | |
| Super Micro Computer Inc. | 11.86 | — | — | — | — | — | |
Based on: 10-K (reporting date: 2018-10-31), 10-K (reporting date: 2017-10-31), 10-K (reporting date: 2016-10-31), 10-K (reporting date: 2015-10-31), 10-K (reporting date: 2014-10-31), 10-K (reporting date: 2013-10-31).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
Operating profit per share = Earnings from operations ÷ No. shares of common stock outstanding
= 4,064,000,000 ÷ 1,553,494,507 = 2.62
3 Closing price as at the filing date of HP Inc. Annual Report.
4 2018 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 22.29 ÷ 2.62 = 8.52
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/OP ratio | Because P/E ratio is calculated using net income, the ratio can be sensitive to nonrecurring earnings and capital structure, analysts may use price to operating profit. | HP Inc. P/OP ratio increased from 2016 to 2017 but then slightly decreased from 2017 to 2018 not reaching 2016 level. |
Price to Sales (P/S)
HP Inc., historical P/S calculation, comparison to benchmarks
| Oct 31, 2018 | Oct 31, 2017 | Oct 31, 2016 | Oct 31, 2015 | Oct 31, 2014 | Oct 31, 2013 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,553,494,507 | 1,645,228,387 | 1,705,451,042 | 1,791,848,366 | 1,834,081,993 | 1,908,777,048 | |
| Selected Financial Data (US$) | |||||||
| Net revenue (in millions) | 58,472) | 52,056) | 48,238) | 103,355) | 111,454) | 112,298) | |
| Sales per share2 | 37.64 | 31.64 | 28.28 | 57.68 | 60.77 | 58.83 | |
| Share price1, 3 | 22.29 | 20.74 | 15.51 | 12.26 | 39.82 | 28.07 | |
| Valuation Ratio | |||||||
| P/S ratio4 | 0.59 | 0.66 | 0.55 | 0.21 | 0.66 | 0.48 | |
| Benchmarks | |||||||
| P/S Ratio, Competitors5 | |||||||
| Apple Inc. | 3.60 | — | — | — | — | — | |
| Arista Networks Inc. | — | — | — | — | — | — | |
| Cisco Systems Inc. | 4.38 | — | — | — | — | — | |
| Super Micro Computer Inc. | 0.33 | — | — | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
Sales per share = Net revenue ÷ No. shares of common stock outstanding
= 58,472,000,000 ÷ 1,553,494,507 = 37.64
3 Closing price as at the filing date of HP Inc. Annual Report.
4 2018 Calculation
P/S ratio = Share price ÷ Sales per share
= 22.29 ÷ 37.64 = 0.59
5 Click competitor name to see calculations.
| Valuation ratio | Description | The company |
|---|---|---|
| P/S ratio | An rationale for the P/S ratio is that sales, as the top line in an income statement, are generally less subject to distortion or manipulation than other fundamentals such as EPS or book value. Sales are also more stable than earnings and never negative. | HP Inc. P/S ratio increased from 2016 to 2017 but then slightly decreased from 2017 to 2018 not reaching 2016 level. |
Price to Book Value (P/BV)
HP Inc., historical P/BV calculation, comparison to benchmarks
| Oct 31, 2018 | Oct 31, 2017 | Oct 31, 2016 | Oct 31, 2015 | Oct 31, 2014 | Oct 31, 2013 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 1,553,494,507 | 1,645,228,387 | 1,705,451,042 | 1,791,848,366 | 1,834,081,993 | 1,908,777,048 | |
| Selected Financial Data (US$) | |||||||
| Total HP stockholders’ equity (deficit) (in millions) | (639) | (3,408) | (3,889) | 27,768) | 26,731) | 27,269) | |
| Book value per share (BVPS)2 | -0.41 | -2.07 | -2.28 | 15.50 | 14.57 | 14.29 | |
| Share price1, 3 | 22.29 | 20.74 | 15.51 | 12.26 | 39.82 | 28.07 | |
| Valuation Ratio | |||||||
| P/BV ratio4 | — | — | — | 0.79 | 2.73 | 1.96 | |
| Benchmarks | |||||||
| P/BV Ratio, Competitors5 | |||||||
| Apple Inc. | 8.93 | — | — | — | — | — | |
| Arista Networks Inc. | — | — | — | — | — | — | |
| Cisco Systems Inc. | 5.00 | — | — | — | — | — | |
| Super Micro Computer Inc. | 1.33 | — | — | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2018 Calculation
BVPS = Total HP stockholders’ equity (deficit) ÷ No. shares of common stock outstanding
= -639,000,000 ÷ 1,553,494,507 = -0.41
3 Closing price as at the filing date of HP Inc. Annual Report.
4 2018 Calculation
P/BV ratio = Share price ÷ BVPS
= 22.29 ÷ -0.41 = —
5 Click competitor name to see calculations.