HP Inc.

S&P Global Ratings' stable outlook on HP reflects its expectation that the company will maintain a leadership position in the global printing and personal computing markets, and will continue generating substantial free cash flow of more than $3.5 billion annually over the next two fiscal years despite rising global trade tensions and competitive threats. These factors should continue to support a conservative credit profile with leverage at about 1x or below over the same period. We could lower the rating if HP's operational performance deteriorates significantly because of greater competition that suppresses revenues and earnings, or if the company pursues more aggressive financial policies, including significant debt-financed acquisitions or shareholder returns that keep debt to EBITDA above 2x. We would

...Rising global trade tensions and a heightened competitive landscape will likely challenge growth. We think the challenging macro and strong competitive environment will likely weigh on HP Inc.'s operational performance in the near term. To date HP has executed well to mitigate most of the challenges it faces and has grown total revenues despite the long-term decline in its end markets. We think HP benefits from solid global market positions in its core PC and printer markets and invests in new printing and computing strategies to advance its market share and leadership within the industry over the long term. We believe HP's leadership and competitive positioning continue to support good cash flow generation, providing operational flexibility to manage disruptive threats to HP's core businesses. We believe HP's conservative financial policy provides it with the operational flexibility to navigate highly competitive markets. HP's commitment to returning up to 75% of free operating cash flow...

Full Report