Return on Equity (ROE)
since 2015
Calculation
Hewlett Packard Enterprise Co., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net earnings (loss) attributable to HPE1 | ÷ | Total HPE stockholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2023 | 9.56% | = | 100 | × | 2,025) | ÷ | 21,182) |
| Oct 31, 2022 | 4.37% | = | 100 | × | 868) | ÷ | 19,864) |
| Oct 31, 2021 | 17.16% | = | 100 | × | 3,427) | ÷ | 19,971) |
| Oct 31, 2020 | -2.01% | = | 100 | × | (322) | ÷ | 16,049) |
| Oct 31, 2019 | 6.14% | = | 100 | × | 1,049) | ÷ | 17,098) |
| Oct 31, 2018 | 8.98% | = | 100 | × | 1,908) | ÷ | 21,239) |
| Oct 31, 2017 | 1.47% | = | 100 | × | 344) | ÷ | 23,466) |
| Oct 31, 2016 | 10.05% | = | 100 | × | 3,161) | ÷ | 31,448) |
| Oct 31, 2015 | 7.34% | = | 100 | × | 2,461) | ÷ | 33,535) |
Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 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).
1 US$ in millions
The Return on Equity (ROE) for the period between 2015 and 2023 is characterized by significant volatility, reflecting inconsistent net earnings and a shifting equity base. The ROE fluctuated from a low of -2.01% in 2020 to a peak of 17.16% in 2021, indicating a high degree of sensitivity to annual profit variations.
- Earnings Volatility and ROE Correlation
- The fluctuations in ROE are primarily driven by instability in net earnings. A sharp decline in earnings in 2017 to US$ 344 million resulted in a corresponding drop in ROE to 1.47%. This volatility peaked in 2020 when net losses of US$ 322 million led to a negative ROE of -2.01%. Conversely, the surge in net earnings to US$ 3,427 million in 2021 produced the highest ROE of the analyzed period at 17.16%.
- Stockholders' Equity Trends
- A sustained downward trend in total stockholders' equity was observed from 2015 to 2020, with the value decreasing from US$ 33,535 million to US$ 16,049 million. This reduction in the equity base effectively amplified the impact of earnings changes on the ROE. Since 2020, the equity base has shown a gradual recovery, reaching US$ 21,182 million by 2023.
- Recent Performance Recovery
- Following the 2020 trough, the ROE experienced a rapid recovery in 2021, followed by a contraction to 4.37% in 2022. By October 31, 2023, the ROE rebounded to 9.56%, supported by an increase in net earnings to US$ 2,025 million. This recent trajectory suggests a stabilization of profitability relative to the equity invested.
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Comparison to Competitors
Hewlett Packard Enterprise Co., ROE, long-term trends, comparison to competitors
| Hewlett Packard Enterprise Co. | Apple Inc. | Arista Networks Inc. | Cisco Systems Inc. | Dell Technologies Inc. | Lumentum Holdings Inc. | Super Micro Computer Inc. | |
|---|---|---|---|---|---|---|---|
| Oct 31, 2023 | 9.56% | 156.08% | 28.91% | 28.44% | — | -9.71% | 32.45% |
| Oct 31, 2022 | 4.37% | 196.96% | 27.68% | 29.70% | — | 10.61% | 20.00% |
| Oct 31, 2021 | 17.16% | 150.07% | 21.13% | 25.66% | 131.10% | 20.14% | 10.20% |
| Oct 31, 2020 | -2.01% | 87.87% | 19.11% | 29.57% | — | 7.75% | 7.91% |
| Oct 31, 2019 | 6.14% | 61.06% | 29.71% | 34.62% | — | -2.43% | 7.64% |
| Oct 31, 2018 | 8.98% | 55.56% | 15.31% | 0.25% | — | 26.79% | 5.47% |
| Oct 31, 2017 | 1.47% | 36.07% | 25.46% | 14.53% | — | -16.56% | 8.64% |
| Oct 31, 2016 | 10.05% | 35.62% | 16.63% | 16.89% | — | 1.87% | 9.99% |
| Oct 31, 2015 | 7.34% | 44.74% | 15.37% | 15.04% | — | -0.89% | 16.46% |
Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 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).
Comparison to Sector (Technology Hardware & Equipment)
Hewlett Packard Enterprise Co., ROE, long-term trends, comparison to sector (technology hardware & equipment)
| Hewlett Packard Enterprise Co. | Technology Hardware & Equipment | |
|---|---|---|
| Oct 31, 2023 | 9.56% | 100.63% |
| Oct 31, 2022 | 4.37% | 122.76% |
| Oct 31, 2021 | 17.16% | 96.47% |
| Oct 31, 2020 | -2.01% | 68.72% |
| Oct 31, 2019 | 6.14% | 52.95% |
| Oct 31, 2018 | 8.98% | 39.07% |
| Oct 31, 2017 | 1.47% | 28.71% |
| Oct 31, 2016 | 10.05% | 29.20% |
| Oct 31, 2015 | 7.34% | 34.61% |
Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 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).
Comparison to Industry (Information Technology)
Hewlett Packard Enterprise Co., ROE, long-term trends, comparison to industry (information technology)
| Hewlett Packard Enterprise Co. | Information Technology | |
|---|---|---|
| Oct 31, 2023 | 9.56% | 31.26% |
| Oct 31, 2022 | 4.37% | 38.03% |
| Oct 31, 2021 | 17.16% | 41.64% |
| Oct 31, 2020 | -2.01% | 35.38% |
| Oct 31, 2019 | 6.14% | 35.94% |
| Oct 31, 2018 | 8.98% | 30.23% |
| Oct 31, 2017 | 1.47% | 23.19% |
| Oct 31, 2016 | 10.05% | 23.00% |
| Oct 31, 2015 | 7.34% | 25.97% |
Based on: 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31), 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).