Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (48630)	7/8/2012 12:03:35 PM
From: Dennis 3	Respond to of 79353

The only reason why HPQ earnings fell sharply over the last 12 months is because of write-offs. Yes the balance sheet is terrible but when purchasing deeply discounted stocks you won't find perfection, hence the deep discount. With their cash flow they can improve the balance sheet. At current price they don't need any break-thru products for their stock to increase 50%-100% IMO. Just pay down debt and bv increases and improves balance sheet.

To: Spekulatius who wrote (48630)	7/8/2012 12:37:03 PM
From: Sergio H	Read Replies (1) \| Respond to of 79353

Looking at Whitman's game plan, so far she has reduced management by merging two divisions, stepped up new product introduction including new notebooks in the sub $700 market, a large storage device and new cloud products, and has announced plans to lay of thousands of employees. The co. still maintains a fleet of seven jet airplanes that cost millions to maintain and they are pouring money into their cloud initiative with no plan on selling off or discontinuing any of their operations. IBM, a major competitor of HPQ has a tangible book value very similar to HPQ's but HPQ is currently trading at a 60% discount to IBM on PE. On these metrics, HPQ is a value stock, but I agree with you that HPQ's survival is at risk due to a highly competitive market. A good historic example of what could happen to HPQ is the pre Silicon Valley high tech companies in Mass. that are no longer in existance...Digital Equipment, Data General, Wang. Interesting that DELL has a positive tangible book value and is also selling at a discount to IBM on PE but that's another story.