February 04, 2026 a 03:31 pm
HPE: Dividend Analysis - Hewlett Packard Enterprise Company
Hewlett Packard Enterprise presents a compelling dividend profile with a moderate yield and a consistent payment history. Despite a high EPS payout ratio, the company's FCF payout remains reasonable, suggesting capacity for sustaining dividends. The moderate dividend growth indicates a steady, albeit cautious expansion approach, aligning with their strategic priorities and offering potential long-term benefits to shareholders.
Overview 📊
In the competitive technology sector, Hewlett Packard Enterprise ("HPE") stands out with a solid dividend strategy. The following table summarizes key dividend metrics for a comprehensive understanding.
| Metric | Value |
|---|---|
| Sector | Technology |
| Dividend Yield | 2.18% |
| Current Dividend per Share | 0.60 USD |
| Dividend History | 11 years |
| Last Cut or Suspension | None |
Dividend History 📈
A consistent dividend history is indicative of a stable financial footing and corporate commitment to returning value to shareholders. HPE's 11-year history without cuts reinforces confidence in its financial strategies and capability to sustain dividends through diverse market conditions.
| Year | Dividend per Share |
|---|---|
| 2025 | 0.5325 |
| 2024 | 0.52 |
| 2023 | 0.49 |
| 2022 | 0.48 |
| 2021 | 0.48 |
Dividend Growth 🗣️
The growth of dividends is a crucial indicator of a company's ongoing commitment to rewarding shareholders with increasing returns. HPE demonstrates a cautious yet positive growth path over the last few years, signaling resilience and potential for future increases.
| Time | Growth |
|---|---|
| 3 years | 3.52% |
| 5 years | 2.09% |
The average dividend growth is 2.09% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio ⚠️
The payout ratio is a vital measure of the sustainability of a company's dividend policy. HPE's high EPS-based payout ratio indicates a potentially aggressive stance, but this is mitigated by a more conservative FCF-based payout, highlighting prudent dividend coverage from cash operations.
| Key figure | Ratio |
|---|---|
| EPS-based | 1396.49% |
| Free cash flow-based | 35.22% |
The excessively high EPS-based payout ratio suggests caution, whereas a significantly lower FCF-based payout ratio reflects a sustainable approach, maintaining dividends without over-leveraging earnings.
Cashflow & Capital Efficiency ⚖️
Cashflow generation and capital efficiency fundamentals are pivotal for supporting dividend policies. HPE exhibits strong free cash flow generation, underscored by positive yields and conservative cash flow to CAPEX use, ensuring a robust financial buffer.
| Key Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Free Cash Flow Yield | 8.01% | 7.74% | 1.94% |
| Earnings Yield | 10.14% | 10.11% | 0.18% |
| CAPEX to Operating Cash Flow | 63.87% | 54.53% | 78.52% |
| Stock-based Compensation to Revenue | 1.47% | 1.43% | 1.87% |
| Free Cash Flow / Operating Cash Flow Ratio | 36.13% | 45.47% | 21.48% |
The trends in cashflow stability indicate strength, showcasing HPE's potential to maintain KPIs whilst managing investments effectively. Being capital efficient aids in assuring dividend coverage.
Balance Sheet & Leverage Analysis 📋
A strong balance sheet is fundamental for dividend sustainability, minimizing risk of cuts due to financial distress. HPE's leverage metrics, while varied, suggest a conservative leverage position in the context of industry norms.
| Financial Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Debt-to-Equity | 0.64 | 0.80 | 0.91 |
| Debt-to-Assets | 23.65% | 27.81% | 29.46% |
| Debt-to-Capital | 38.95% | 44.40% | 47.53% |
| Net Debt to EBITDA | 1.91 | 0.89 | 6.32 |
| Current Ratio | 0.87 | 1.29 | 1.01 |
| Quick Ratio | 0.66 | 0.99 | 0.76 |
| Financial Leverage | 2.70 | 2.87 | 3.07 |
Overall, the company's financial stability seems adequately positioned, with its capital structure supporting dividend continuity within a manageable risk threshold despite some variations.
Fundamental Strength & Profitability ✅
Analyzing profitability and capital use efficiency is critical for assessing long-term dividend sustainability. HPE's returns and margins provide insights into operational efficiency and profit conversion, both vital for dividend health.
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Return on Equity | 9.56% | 10.39% | 0.23% |
| Return on Assets | 3.54% | 3.62% | 0.08% |
| Margins: Net, EBIT, EBITDA, Gross | 6.96%, 7.66%, 16.65%, 34.09% | 8.58%, 9.97%, 18.50%, 31.77% | 0.17%, -0.32%, 7.66%, 28.77% |
| Research & Development to Revenue | 8.07% | 7.47% | 7.34% |
HPE shows fluctuating margins, however, general strength in R&D suggests potential for future performance improvements, fortifying dividend capacity.
Price Development 📉
Dividend Scoring System ⭐
The following scoring system evaluates key dividend-related metrics, aggregating them into an overall score for investor insight.
| Criterion | Score (1-5) | Score Bar |
|---|---|---|
| Dividend Yield | 3 | |
| Dividend Stability | 4 | |
| Dividend Growth | 3 | |
| Payout Ratio | 2 | |
| Financial Stability | 3 | |
| Dividend Continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 3 |
Total Score: 27/40
Rating 🏅
Hewlett Packard Enterprise exhibits a solid dividend framework supported by strategic operational practices. While some metrics indicate caution, the overall financial foundation and dividend approach suggest a robust and sustainable dividend potential. Investors seeking moderate yield with stability and gradual growth may find HPE an attractive candidate for portfolio diversification.