Ratings on Hewlett-Packard Co. (HP) reflect its position as a leading, global vendor of computer printers, computer systems and services, and peripherals. Fiscal 2000 revenues of $48.7 billion incorporate a dominant position in the laser/inkjet printer market and important positions in the personal computer and server markets. HP's historical financial performance has been very consistent, despite quarterly fluctuations in growth and profitability. Responsive control of expenses and headcount has enabled HP to maintain annual operating margins (before depreciation and amortization) of 10% to 14%, and return on permanent capital of 20% or better. Based on the global slowdown in consumer IT spending, however, HP expects a moderate revenue decline in the second quarter of fiscal 2000, and profitability well below
