Hewlett Packard Enterprise (NYSE:HPE) Quarterly Earnings Preview

• The anticipated EPS of $0.34 marks a 19.1% decline from the previous year, indicating challenges HPE faces.
• Revenue is projected to increase by 3.7% to $7.47 billion, showing potential growth despite obstacles.
• HPE's valuation remains attractive with a forward P/E ratio under 10 and a strong dividend yield, reflecting limited growth expectations and ongoing business challenges.

Hewlett Packard Enterprise (NYSE:HPE) is preparing to announce its quarterly earnings on June 3, 2025. Analysts predict an earnings per share (EPS) of $0.34, with revenue expected to be around $7.47 billion. HPE, a key player in the technology sector, provides solutions in IT infrastructure, software, and services. It competes with companies like Dell Technologies and IBM.

The anticipated EPS of $0.34 marks a 19.1% decline from the previous year, highlighting some challenges HPE faces. Despite this, revenue is projected to increase by 3.7% to $7.47 billion, as highlighted by the recent analyst consensus. This upward revision of EPS by 0.7% over the past month suggests a positive reassessment by analysts, which can influence investor sentiment and stock price movements.

HPE is currently dealing with several challenges, including delays in its acquisition of Juniper, which affects its free cash flow. Trade and tariff issues also pose hurdles. Despite these challenges, HPE's valuation remains attractive, with a forward P/E ratio under 10 and a strong dividend yield. However, this valuation reflects limited growth expectations and ongoing business challenges.

Activist investor Elliott Management's $1.5 billion stake in HPE could lead to significant changes within the company. However, concerns about leadership uncertainty and execution risks persist. HPE's financial metrics, such as a P/E ratio of 8.31 and a price-to-sales ratio of 0.74, indicate the market's valuation of its earnings and sales. The company's enterprise value to sales ratio of 0.89 and enterprise value to operating cash flow ratio of 7.11 provide insights into its valuation relative to sales and cash flow generation.

HPE's earnings yield of 12.03% offers a perspective on the return on investment, while its debt-to-equity ratio of 0.71 shows the proportion of debt used to finance its assets. The current ratio of 1.33 suggests that HPE has a good level of liquidity to cover its short-term liabilities, indicating financial stability despite the challenges it faces.