June 11, 2025 a 02:47 am
HPE: Dividend Analysis - Hewlett Packard Enterprise Company
Hewlett Packard Enterprise Company exhibits a stable dividend policy with a current yield of 2.84%. While the company has a strong dividend history of 11 years, recent growth rates suggest moderate increments. Given the resilience in its payout ratio and earnings strength, HPE continues to be appealing to income-seeking investors.
📊 Overview
Hewlett Packard Enterprise operates within the technology sector, delivering robust solutions. The company's dividend yield is an attractive 2.84%, with the current dividend per share standing at $0.52 USD. Its uninterrupted dividend history over 11 years underscores stability. There have been no recent cuts or suspensions in its dividend payouts, indicating a commitment to shareholder returns.
| Metric | Value |
|---|---|
| Sector | Technology |
| Dividend Yield | 2.84% |
| Current Dividend Per Share | 0.52 USD |
| Dividend History | 11 years |
| Last Cut or Suspension | None |
🗣️ Dividend History
An analysis of dividend history reveals consistent payments, which are vital for assessing reliability and trust in the company's payout practices. Historical data shows progressive increments in dividends, enhancing investor confidence.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.26 |
| 2024 | 0.52 |
| 2023 | 0.49 |
| 2022 | 0.48 |
| 2021 | 0.48 |
📈 Dividend Growth
Dividend growth is a crucial factor influencing investment decisions, reflecting a company's financial health and policy strategy. Over the past 3 years, the growth rate has been approximately 2.70%, and over 5 years, it has been about 2.59%.
| Time | Growth |
|---|---|
| 3 years | 2.70% |
| 5 years | 2.59% |
The average dividend growth is 2.59% over 5 years. This shows moderate but steady dividend growth.
⚠️ Payout Ratio
Payout ratios are instrumental in understanding dividend sustainability. Currently, the EPS-based payout ratio is 47.88%, and the FCF-based payout ratio is notably high at 633.33%. These figures indicate that while EPS-based payouts remain sustainable, high FCF payouts may warrant monitoring.
| Key Figure Ratio | Value |
|---|---|
| EPS-based | 47.88% |
| Free Cash Flow-based | 633.33% |
✅ Cashflow & Capital Efficiency
Cashflow and capital efficiency metrics are critical when evaluating a firm's operational health and investment returns. HPE exhibits a strong earnings yield and a stable FCF/OCF ratio, showcasing its ability to convert income effectively.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Free Cash Flow Yield | 7.91% | 8.01% | 7.74% |
| Earnings Yield | 4.67% | 10.14% | 10.11% |
| CAPEX to OCF | 67.97% | 63.87% | 54.53% |
| Stock-based Compensation to Revenue | 1.37% | 1.47% | 1.43% |
| Free Cash Flow / OCF Ratio | 32.03% | 36.13% | 45.47% |
The metrics suggest HPE's solid cashflow stability and capital efficiency, pivotal for enhancing investor returns.
📉 Balance Sheet & Leverage Analysis
Evaluating leverage metrics assists in understanding financial stability. HPE maintains a modest debt-to-equity ratio and sufficient current ratio indicating strong financial health and liquidity.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Debt-to-Equity | 62.75% | 63.80% | 73.53% |
| Debt-to-Assets | 21.82% | 23.65% | 25.60% |
| Debt-to-Capital | 38.56% | 38.95% | 42.37% |
| Net Debt to EBITDA | 1.74 | 1.83 | 0.68 |
| Current Ratio | 0.88 | 0.87 | 1.29 |
| Quick Ratio | 0.66 | 0.66 | 0.99 |
| Financial Leverage | 2.88 | 2.70 | 2.87 |
HPE's balance sheet reflects robust financial leverage and liquidity position, vital for sustaining operations and future growth.
💰 Fundamental Strength & Profitability
Profitability metrics like ROE and margins are essential for assessing the inherent strength of HPE. The company presents modest returns, but consistent margin improvements offer a positive outlook.
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Return on Equity | 4.37% | 9.56% | 10.39% |
| Return on Assets | 1.52% | 3.54% | 3.62% |
| Net Margin | 3.05% | 6.95% | 8.56% |
| EBIT Margin | 7.82% | 8.38% | 8.28% |
| EBITDA Margin | 16.77% | 17.36% | 16.68% |
| Gross Margin | 33.36% | 35.14% | 32.68% |
| R&D to Revenue | 7.18% | 8.06% | 7.46% |
Profitability metrics indicate HPE's strengthening operational performance, showcasing potential for enhanced shareholder returns.
📊 Price Development
Dividend Scoring System
| Category | Score | Score Bar |
|---|---|---|
| Dividend Yield | 4 | |
| Dividend Stability | 4 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 4 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 3 | |
| Balance Sheet Quality | 4 |
Total Score: 29/40
Rating
Based on comprehensive analysis, HPE holds a stable but growth-focused dividend profile with robust financial fundamentals to back its practices. The company is a commendable choice for income-focused investors who appreciate consistency and potential for moderate long-term return. Recommendation: 🟢 Buy.