Cisco Systems, Inc. (CSCO) vs Hewlett Packard Enterprise Company (HPE)

Cisco Systems, Inc. and Hewlett Packard Enterprise Company are both Communication Equipment companies. Cisco Systems, Inc. is the larger, with a market value of $422.0B against $86.2B — 4.9× the size. Hewlett Packard Enterprise Company trades at the lower P/E: 31.3× against 31.8×. Hewlett Packard Enterprise Company grew revenue faster over the last twelve months: 26.6% against 11.8%. Cisco Systems, Inc. has the higher net margin (21.0% vs 6.39%) and the higher return on invested capital (17.9% vs 4.31%). Both pay a dividend; Hewlett Packard Enterprise Company yields more (3.34% vs 3.15%). Across the 23 metrics below, Cisco Systems, Inc. leads on 12 and Hewlett Packard Enterprise Company on 11.

Valuation

Metric CSCO HPE Communication Equipment median
P/E 31.84 31.31 33.61
P/S 6.66 2.01 2.16
P/B 8.39 3.16 2.40
Price to free cash flow 33.03 18.40 25.02
EV/EBITDA 23.74 12.34 13.78
EV/Sales 6.71 2.27 2.27
Earnings yield 3.14% 3.19% (0.65%)
Free cash flow yield 3.03% 5.43% 1.61%

Profitability

Metric CSCO HPE Communication Equipment median
Gross margin 64.52% 36.73% 39.47%
Operating margin 24.27% 6.21% 2.39%
Net margin 20.95% 6.39% (0.74%)
Free cash flow margin 20.16% 10.91% 1.39%
Return on equity 27.32% 10.48% (1.91%)
Return on assets 10.53% 3.32% (0.20%)
Return on invested capital 17.87% 4.31% 0.72%

Growth

Metric CSCO HPE Communication Equipment median
Revenue growth (TTM) 11.77% 26.59% 11.48%
EPS growth (last fiscal year) 27.59% (102.07%) —
Revenue growth, 5-year CAGR 4.92% 4.91% 4.92%
Net income growth, 5-year CAGR 4.61% 0.00% 0.00%

Health

Metric CSCO HPE Communication Equipment median
Debt to equity 0.39 0.65 0.06
Current ratio 0.93 1.11 2.01
Net debt to EBITDA 0.19 3.06 0.67

Dividend

Metric CSCO HPE Communication Equipment median
Dividend yield 3.15% 3.34% 2.63%
Payout ratio 0.50 0.58 0.00

Size

Metric CSCO HPE Communication Equipment median
Market cap 422.01b 86.15b 563.45m

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