Hewlett Packard Enterprise Company (HPE) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Hewlett Packard Enterprise Company

Updated on October 26, 2026 · accounts published on September 2, 2026

Reading of October 23, 2026: A growing hardware business with thin margins, weak returns on capital and heavy debt

Hewlett Packard Enterprise trades at a P/E of 29.4 over the last 12 months, 5 % below its sector median of 30.8, after a 147 % rise in a year.

• Is Hewlett Packard Enterprise expensive or cheap? At a P/E of 29.4 over the last 12 months, Hewlett Packard Enterprise trades 5 % below its sector median of 30.8.
• How is the business doing? Revenue grew 14 % over the last 12 months, and the 8.3 % operating margin barely tops its 2014-2025 average of 7.1 %.
• How strong is the balance sheet? Net debt reached 7.0× EBITDA in fiscal 2025, far above the 2.0× considered tolerable for a hardware company.
• What to expect from the next earnings? Analysts expect EPS of $1.27 for the quarter reported on December 3, 2026, with 19 of 40 recommending buy.
• Does it grow with real cash or by diluting shareholders? Free cash flow was just 1.8 % of revenue in fiscal 2025, against the 20 % that marks a healthy technology company.

Is Hewlett Packard Enterprise expensive or cheap?

Hewlett Packard Enterprise trades at a P/E of 29.4 over the last 12 months, 5 % below the 30.8 median of 359 companies in its sector. That discount is thin, and other measures look less forgiving. EV/EBITDA stands at 14.2× against a five-year average of 8.4×, well above the 110 % line that marks it as expensive against its own history. The free cash flow yield is 5.6 % and price to book 2.8× over the last 12 months. The stock has gained 147 % in a year and still sits 23 % below its 52-week high of $73.46, so much of the rerating has already happened.

How is the business doing?

Revenue rose 14 % over the last 12 months, and the operating margin recovered to 8.3 % from 4.8 % in fiscal 2025, the lowest of the last 12 fiscal years. Against the 2014-2025 average of 7.1 %, that is a modest improvement. EPS fell 102 % year on year over the same period, a figure that sits awkwardly with sales growth. Returns are the weak spot: ROIC of 6.2 % over the last 12 months is 2.0 points below the sector median of 8.2 %, and it has not exceeded 10 % in any of the last 10 fiscal years.

How strong is the balance sheet?

The balance sheet is the main point of tension. Net debt was $13.96 per share in fiscal 2025 ($18.32 of debt minus $4.36 of cash), equal to 25 % of the current price and 7.0× EBITDA, against the 2.0× considered tolerable in hardware. Debt to equity of 0.8× over the last 12 months looks moderate on its own, but the Altman Z-score of 0.9 sits in the distress zone and the Piotroski score is 4 out of 9. A current ratio of 1.1 leaves little cushion, and the 1.0 % dividend yield is a small reward for that risk.

What to expect from the next earnings?

Hewlett Packard Enterprise reports on December 3, 2026, and analysts expect EPS of $1.27 for the quarter. The track record gives some support: the company beat EPS estimates in 7 of the last 8 quarters, and on September 2, 2026 it posted $1.11 against $0.93 expected, a 19 % surprise. The 2026 EPS consensus of $3.82 from 12 analysts has not moved in 30 days, and revenue estimates are equally stable. Of 40 analysts, 19 recommend buying, 20 holding and 1 selling. The report will show whether the margin recovery holds.

Does it grow with real cash or by diluting shareholders?

In technology, generic ratios fall short: growth, pricing power and dilution from stock-based pay say more about business quality. Hewlett Packard Enterprise passes only on dilution, with stock compensation at 1.9 % of revenue in fiscal 2025, well under the 10 % healthy ceiling. Revenue per share grew 6.3 % a year over fiscal 2022-2025, against a healthy pace of 15 %. The fiscal 2025 gross margin of 28.8 % is below the 35 % that signals pricing power in hardware, and free cash flow covered just 1.8 % of revenue. Shareholders are protected from dilution; the problem is that growth produces little cash.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.