Shares of enterprise information technology company Hewlett Packard Enterprise (HPE) have gained 33.7% over the past year. Recently, HPE reported a mixed set of fourth-quarter numbers with revenue lagging analysts’ estimates.
Significantly, during this period, HPE’s total as-a-service orders jumped 114%, and the company declared a quarterly dividend of $0.12 per share payable on January 7, 2022.
With these developments in mind, let us take a look at the changes in HPE’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, Hewlett Packard’s top two risk categories are Finance & Corporate and Tech & Innovation, contributing 43% and 14% to the total 28 risks identified, respectively. In its recent annual report, the company has removed one key risk factor under the Macro & Political risk category.
This risk highlights the potential adverse impact on HPE’s business and results of operations from the U.S. trade policy, including the imposition of tariffs and its consequences. HPE had highlighted that the U.S. trade policy, which includes tariffs on certain foreign goods including IT products, brings uncertainty and could necessitate HPE to increase prices for its products, which may hamper demand.
If the company is not able to pass on price increases, then its margins may take a hit as a consequence.
Meanwhile, compared to a sector average of 9%, HPE’s Macro & Political risk factor is at 11%.
Hedge Fund Activity
TipRanks data points that Wall Street’s best hedge funds have decreased their holdings in Hewlett Packard by 1.2 million shares in the last quarter, indicating a negative hedge fund confidence signal in the stock based on activities of 12 hedge funds in the recent quarter.
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