Analyst On HP: The Stock Is Technically Worth Negative $2
Source: Business Insider
HP this morning lost one of the few Wall Street analysts that was still giving it the benefit of the doubt. Sterne Agee analyst Shaw Wu downgraded his recommendation to neutral, telling us that HP's balance sheet is so awful, the company's stock is really worth negative $2.
"Their balance sheet is a mess," Wu told Business Insider. "We calculatedI couldn't believe thisthe tangible book value [at] -$2 [a share]. The book value, when you look at it, says $16. But you have to take out the $36 billion in goodwill. They are going to write that off, the whole thing at some point. So basically, the company's intrinsic value is negative. They are fortunate the stock's not zero. This is not an opinion. These are facts."
Besides the balance sheet, Wu says the company has a handful of other issues for which there's no easy fix. These include a PC business under attack from mobile devices, Windows 8 sales that will likely be lackluster and a printer business dying as people shift to electronic displays.
"We've given them the benefit of the doubt," Wu told Business Insider. "They are blaming everything on the economy. But the problems they have are not economy-related. If that's the case, why are Apple and IBM doing well? To us that makes no sense. So we think the problems are structural."
Read more: http://www.businessinsider.com/shaw-wu-sterne-agee-hp-valuation-2012-10
I posted a while back that HP was likely unsalvageable on its own, and totally unsalvageable under Meg Whitman, who is there to fire people and collect a big exit check. Nothing more.
Mittens will be proud. These people are crooks.
The_Counsel
(1,660 posts)...someone would be paying ME to take it off their hands?
How do I get in on THAT action...?
Cobalt-60
(3,078 posts)Then positive cash comes to us.
I'll have 5 million shares, please!
Kelvin Mace
(17,469 posts)The stock is worth NEGATIVE $2 a share, but he is only "neutral" on it?
I assume that HP would have to sell a computer which gave everyone the Ebola virus before this guy would issue a "sell" recommendation.
kimbutgar
(21,210 posts)I shudder to think where we would be here in California is Meg was elected Governor. Probably preparing to declare bankruptcy and rigging the election.
This was the sort of expertise and experience she was going to bring to running Cali? Thanks, voters, for not falling for that canard. We really dodged a bullet on that one.
truthisfreedom
(23,157 posts)wordpix
(18,652 posts)and that would look bad for Meg when she ran for gov---or was that another repuke?
Anyhow, as I recall, the household worker had been with Whitman for several years and I think she was let go without severance or anything, so she blew the whistle.
I'm not from CA and it was awhile ago...don't know if I have the story straight.
Ash_F
(5,861 posts)Or hell, could have been both in separate cases.
Brother Buzz
(36,469 posts)Truth be told, it was Carly Fiorina's stewardship that started HP's auger into the ground.
Bill Hewlett and David Packard are rolling in their graves.
Stargazer09
(2,132 posts)Their printers eat so much ink that I replaced all of them with printers from Epson and Brother. I habitually write the installation dates on the printer cartridges I use, and my new printers are very frugal with ink, especially when compared to my HP printers.
HP's scientific calculators used to be standard issue for engineers, but they stopped trying to make them better than the TI calculators at least two decades ago. I loved my calculator, back in the day, but they are nothing more than paperweights now.
Not Sure
(735 posts)Wow, HP printers must have fallen off a cliff. Back in my civil engineering days, we used HP printers and plotters early on, eventually switching to Oce for the plotter. The HP printers stuck around for printing contracts and other documents until they were replaced by copiers. And I had an inkjet at home that did a pretty good job, too. Eventually, I went with Epson for the quality, but it was an ink hog. I ended up replacing it a couple years later with a new, improved Epson. Again, great quality but an ink hog. Between HP and Epson, I got way more out of the HP as far as ink is concerned. I wouldn't know how they are today, though.
And I still use my RPN HP 32sII calculator. They'll have to pry it from my cold, dead hands...
sendero
(28,552 posts)... ridiculous consumers of ink, and their ink cartridges are overpriced. I'm done with them, I'm going to get a laser printer that prints 3000 pages on one toner cart that only costs twice what their crappy ink cartridges cost.
Don't compare HP of today to what they once were. They were once a world leader in scientific instrumentation and other cool stuff. Now they are third-rate electronic crap salesmen.
Stargazer09
(2,132 posts)I used to replace color cartridges in my relatively HP nearly every month, at $45+ per cartridge. My Epson has six individual cartridges, and I get about a year out of the colors and six months for the black. I print mostly knitting patterns with that printer, so lots of large, colorful pages totaling about 500 pages per year or so. My Brother printer gets a lot more use on a day-to-day basis, but mostly printing text, and it's frugal on ink, too.
I love the RPN function on my HP 48g!
Hugin
(33,207 posts)'cept for maybe Techtronics.
Oh, but, they don't make that anymore. *sigh*
Stargazer09
(2,132 posts)It's sad how far they've fallen.
GeorgeGist
(25,323 posts)wasn't built by sociopaths.
bucolic_frolic
(43,311 posts)So this analyst admits he's just now looked at the goodwill on the balance sheet?
What has he been analyzing? Chocolate bon-bons?
Hugin
(33,207 posts)Gman
(24,780 posts)Clear Channel used to do the same thing to cover up bad financials.
wordpix
(18,652 posts)This after the salesman told me the parts in the ProBook were so wonderful, I would not have a problem.
This after I had previously bought a brand new HP desktop in 2004 and had to take it back for not powering on. The second one I took home I had to bring back for not booting up. The third was a Sony Vaio that's been great, no problems for 7 years.
Now I'm trying to get some money back for my ProBook repair + new hard drive but I keep getting the runaround from HP. They're sending my request all over the world, to the the tech people, the sales people, to Meg Whitman's office...I know I probably won't get reimbursed but it's been instructive on how badly run this company is.
I do love my ProBook, despite it all - however, it cost me a lot of money to get the problem diagnosed and then get the HD replaced after one year of use.
jsr
(7,712 posts)The old HP is long gone.