On September 22, 2023, renowned investor Warren Buffett (Trades, Portfolio) reduced his stake in HP Inc (HPQ, Financial), a leading player in the PC and printing markets. This article provides an in-depth analysis of the transaction, Buffett's investment philosophy, and the current state of HP Inc.
Details of the Transaction
Warren Buffett (Trades, Portfolio), through his investment firm Berkshire Hathaway, sold 4,788,472 shares of HP Inc on September 22, 2023, at a trading price of $26.98 per share. This transaction resulted in a -4.15% change in Buffett's portfolio, reducing his total holdings in HP Inc to 110,662,174 shares. Despite the reduction, HP Inc still constitutes a significant 0.86% of Buffett's portfolio, with Berkshire Hathaway holding an 11.20% stake in the company.
Profile of Warren Buffett (Trades, Portfolio)
Warren Buffett (Trades, Portfolio), often referred to as "The Oracle of Omaha," is one of the most successful and respected investors in history. He studied under the legendary Benjamin Graham at Columbia University, who had a significant impact on Buffett's investment strategies. Buffett is the Chairman of Berkshire Hathaway, which he transformed from a textile company into a major insurance conglomerate. His investment philosophy revolves around acquiring great companies trading at a discount to their intrinsic value and holding them for a long time. As of September 23, 2023, Buffett's equity stands at $348.19 billion, spread across 49 stocks, with a significant focus on the Technology and Financial Services sectors. His top holdings include Apple Inc (AAPL, Financial), American Express Co (AXP, Financial), Bank of America Corp (BAC, Financial), Chevron Corp (CVX, Financial), and Coca-Cola Co (KO, Financial).
Overview of HP Inc
HP Inc, formerly known as Hewlett-Packard, is a dominant player in the PC and printing markets. The company, which went public on November 6, 1957, has focused on these markets since it exited IT infrastructure in 2015 with the split from Hewlett Packard Enterprise. HP Inc has a broad and global customer base, with only one-third of sales coming from the U.S. As of September 23, 2023, the company has a market capitalization of $26.46 billion and a stock price of $26.77.
Analysis of HP Inc's Stock
HP Inc's stock has a PE percentage of 11.55, indicating that the company is profitable. According to GuruFocus, the stock is modestly undervalued with a GF Value of $31.91 and a Price to GF Value ratio of 0.84. The company's GF Score is 87/100, suggesting good outperformance potential. HP Inc also has a strong Profitability Rank of 8/10, a Growth Rank of 8/10, and a GF Value Rank of 6/10. However, its Financial Strength is slightly lower at 5/10.
Comparison with Other Gurus
Other notable gurus who hold HP Inc stock include Dodge & Cox and Joel Greenblatt (Trades, Portfolio) of Jefferies Group (Trades, Portfolio). However, none of these gurus hold as significant a stake in HP Inc as Warren Buffett (Trades, Portfolio)'s Berkshire Hathaway.
Conclusion
In conclusion, Warren Buffett (Trades, Portfolio)'s recent transaction has slightly reduced his stake in HP Inc, but the company remains a significant part of his portfolio. Despite the reduction, HP Inc's strong GF Score, Profitability Rank, and Growth Rank suggest that it still holds potential for value investors. As always, investors are advised to conduct their own comprehensive analysis before making investment decisions.
