The ratings on Hewlett-Packard Co. (HP) reflect the improved market position of HP after its May 2002 merger with Compaq and its strong financial profile for the rating. However, these factors are partially offset by the significant level of operational execution risk inherent in the highly competitive and rapidly evolving technology market, as well as the company's predominant earnings reliance on its printing and imaging segment. Palo Alto, Calif.-based HP is a leading, global vendor of computing and imaging solutions and services, with annual revenues in excess of $70 billion. HP is ahead of its cost-reduction targets and continues to post strong results in its imaging and printing group. Largely driven by improved performance in the personal systems and enterprise
