Computer Hardware · NYSE
Current Price
$20.14
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on HP Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
HP Inc. provides personal computing and other access devices, imaging and printing products, and related technologies, solutions, and services in the United States and internationally. The company operates through three segments: Personal Systems, Printing, and Corporate Investments. The Personal Systems segment offers commercial and consumer desktop and notebook personal computers, workstations, thin clients, commercial mobility devices, retail point-of-sale systems, displays and peripherals, software, support, and services. The Printing segment provides consumer and commercial printer hardware, supplies, solutions, and services. The Corporate Investments segment is involved in the HP Labs and business incubation, and investment projects. It serves individual consumers, small- and medium-sized businesses, and large enterprises, including customers in the government, health, and education sectors. The company was formerly known as Hewlett-Packard Company and changed its name to HP Inc. in October 2015. HP Inc. was founded in 1939 and is headquartered in Palo Alto, California.
ROIC (TTM)
23.3%
ROE (TTM)
1135.3%
FCF Yield
15.57%
Based on trailing twelve-month data, HPQ shows a free cash flow per share of N/A and a ROIC of 23.3%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 15.57% are important context metrics when evaluating HPQ's stock valuation relative to peers.
The intrinsic value of HPQ depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether HPQ is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $20.14. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on HP Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Computer Hardware industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting HPQ's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For HP Inc., this means projecting how much free cash flow the Computer Hardware will produce over the next 5-10 years, then discounting those amounts to today's dollars. HPQ's ROIC of 23.3% indicates strong capital efficiency, which supports higher growth assumptions in the DCF model.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For HPQ, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
