Hewlett Packard Business Analysis Part 2

1894 words - 8 pages

Hewlett Packard- Business Analysis Part 2
Dalia Alawami
July 09, 2012
Ms. Sandra Griffin

Hewlett Packard- Business Analysis Part 2
In order to take a decision of investing at any company it is important to determine the financial health of that company. Thence, it is mandatory to review some financial documents such income statement, balance sheet and cash flow statement, which help to get full image about the financial condition of a firm. In this respect I have accessed financial details of Hewlett Packard to support my previous opinion of investing in that organization.

Financial Health:
According to the annual report of Hewlett Packard total ...view middle of the document...

According to financial data Hewlett Packard is coming in the middle between IBM and Dell in some aspects. Net income is higher than Dell and lower than IBM. Also, from reviewing the cash flow of the three organizations, it seems that HP had more cash flow from operations during 2011 in comparing to 2010 which means investing opportunity is better, also amount of cash flow for HP is more than Dell. On the other hand, IBM registered the highest amount in this area between both companies with $ 19,846 billion cash flow from operation activities.

The whole financial health of Hewlett Packard looks stable. Income statement shows that there was slight different in the amount of net income between 2010 and 2011, however such difference can be adjusted in 2012, since figures shows clearly increase in the net income during first and second quarter. From balance sheet I can determine that financial conditions of the company are good and steady. In the other hand, cash flow is getting positively increased from 2010, 2011 to 2012, so investing in HP is so far good idea. However, there are some weak areas that should be improved in order to increase profits. What concerns me now is the situation at Asia-Pacific country, as mentioned above is the less active region in comparing to other regions such USA, Canada and the Middle East. So, HP should implemented new strategies in order to enhance its activities, which is already been taking in HP’s consideration by releasing new products to China market as plan of 2012. The new products will include all-in-one computer, the all- one laser printer HP Office jet 150 Mobile and Ultrabook. Also, the lack of software segment cannot be neglected as shown in HP annual report that segment has achieved only 3% from the total revenue. Therefore, Bill Veghte the new company’s chief officer has announced at the beginning of 2012 that the new strategy of HP is to have more focus on HP software over hardware, so there will be new products and ideas to support costumers’ needs.
Technological Advantages:
Technology usually used to empower and support organization work, it has a great impact on operating the business and the way organizations interact with their customers and suppliers. Hence when functionality of organization is in the industry of information technology, it will have more powerful tools to enhance its work. However, Hewlett Packard, IBM and Dell are three organizations competing in the same market, which means each organization of the three has an access to all kinds of technology. In addition to taking advantages from computers hard, software, networking systems, emails and computer applications such as electronic spread sheets, database and graphics, HP was able to improve and use several technologies in order to serve its customers in an efficient way. Previously HP faced challenges in delivering it products to customers and managing its different projects globally were multiple languages are...

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