Wednesday, September 16, 2015

The newest fan blog

I can only imagine that with this recent round of layoffs, even more fan blogs will be on the rise. Here is a link to the latest, combining classic art with Meg Whitman.

Here is the link to the tumblr.

The Latest Lies from Meg Whitman

Meg Whitman is a lying idiot. Finally it is becoming clear to the masses as time wears on.

How can she make this statement and then lay off up to 80,000 employees over the last four years? Good engineering companies don't operate this way.

Just a little lie, right Meg? 
Her own words from a Re/code article, taken during her own presentation, said that HP Enterprise will have about $5.5 billion in net cash. Asked about possible acquisitions, she said the company will continue to take a "disciplined approach" to M&A deals and cited HP's recent $3 billion deal for Aruba Networks as an example.

"We haven't done anything stupid in the last four years, and we don't intend to do anything stupid in the future," she said.

Friday, April 11, 2014

Article: A Bit Of Rot Beneath Hewlett Packard's Shiny Surface

Seeking Alpha posted another article on HP today, giving some valuable insight to investors as it relates to the recent corruption allegations.

The highlights of the article are:
Recently, HPQ announced a settlement of $108 million for charges brought by the SEC on bribery of foreign governments to obtain contracts for their computer products.

The company’s general counsel assured prosecutors that the wrongdoing was performed by a small group of people, who are no longer with the company. 

Investors should monitor HPQ more carefully following this corruption; however, given HPQ’s strong fundamentals, should wait to take profits unless further misdeeds are revealed.

Here is the rest of the article:

HP Settles Problem
Hewlett Packard (HPQ) has been one of the top names in computer technology for decades. The company's ability to supply quality products at popular prices has made it a favorite in the United States and around the world.

Recently, the company announced the settlement of $108 million for charges brought by the U.S. Department and Securities and Exchange Commission on bribery of foreign governments to obtain contracts for their computer products.

Department of Justice/SEC Claims
Unfortunately, it was not just one claim of bribing a foreign government for business contracts that got HP into difficulty. It appears to have been a systemic strategy of doing business in a number of countries around the world.

In Russia, HP was found to have paid over $2 million to a governmental official to allow them to continue their multi-million dollar contract with a federal prosecutor's office. Much the same thing was done in Poland, where HP handed out $600,000 in a combination of money and gifts to help them win a contract with their national security office.

The Settlement Deal
The company fully cooperated with the DOJ and SEC during the investigation. In return for the $108 million, the Department of Justice agreed to put off prosecution of the company's Polish unit on the charges. They also signed a non-prosecution agreement against the company's Mexico division.
However, it became clear during the investigation that HP had put aside a slush fund for bribe money, as well as shell companies to lauder funds. Anonymous e-mail accounts and prepaid phones were used to make contact with officials to arrange the deals.

HP Attempts To Move Forward
Clearly, HP did not come out of the process smelling like a rose. Whatever poor decisions had been made in their eagerness to secure these contracts, the company is taking specific steps to resolve the matter and put it behind them.

The company's general counsel John Schultz assured prosecutors that the wrongdoing was performed by a small group of people, who are no longer with the company. Despite these assurances, investors are wondering what other information may crop up to shear off profits and undermine the company's reputation.

Should Investors Move On As Well?
HPQ stock has been strong thus far in Q1 2014 (see chart below), receiving two significant rating upgrades from Deutsche Bank and Barclays in the past two months.

(Yahoo! Finance)

While this recent news is certainly troubling, investors should hope Mr. Schultz's statement concerning a localized, now removed, group of wrongdoers is true, and that corrupt practices have not spread throughout the company.

While shareholders should thus be more critical of HPQ, we recommend waiting to take profits unless further misdeeds are revealed.

Wednesday, April 9, 2014

Article: HP to acknowledge "corrupt" activities in Poland

Article sources:

Hewlett-Packard (HPQ) is set to acknowledge today that it has engaged in "corrupt activities in Poland," the country's interior minister has said.

Poland interior minister, Barlomiej Sienkiewicz said, "I confirm that it's goin to happen today. It's a breakthrough moment in Poland when a great international company acknowledges its corrupt activities in Poland".

The interior minister also stated that Poland's Central Anti-Corruption Bureau has cooperated with the FBI and SEC on the issue, but did not state whether HP would be prosecuted.


UPDATE:  Source:

Polish prosecutors alleged on Wednesday that a local executive with U.S. firm Hewlett-Packard Co. paid bribes worth over $500,000 in exchange for help winning contracts to supply computer equipment to the Polish police headquarters.

Thursday, April 3, 2014

Seeking Alpha Article - Hewlett-Packard's Turnaround: The Devil's Advocate

Seeking Alpha posted an article this morning titled "Hewlett-Packard's Turnaround: The Devil's Advocate", explaining why Meg Whitman's projected turnaround is "still some way off".

This is the same sentiment we saw in the Yahoo finance article on HP a few weeks ago.

The article takes note of some issues I've discussed already, namely that HP revenues are down in all market segments and any future market share stands a good chance of being eaten up by other major players (Lenovo, Cisco) due to poor executive leadership.

HP's advancement relies heavily on having innovative leaders at the helm who can see and create the opportunities for the company to compete for market share and lead in a market segment - Whitman isn't it.

Some clips from the article:

"The turnaround is still some way off

While HP is still generating a healthy cash flow, there is concern over its revenue streams and shrinking margins in PC and other hardware sales, as confirmed in the negative growth in the Personal Systems, Enterprise Group and Enterprise Services business segments. This is unlikely to change in the near future due to decreasing margins and increasing competition.

Worldwide revenues for hardware sales are decreasing, as can be seen in the following table, which shows how all server vendors are affected. Computer hardware margins are razor-thin and expected to decrease further as the IT hardware industry becomes more and more commoditized. Furthermore, Lenovo entering the server market poses a threat to HP's server sales. If Lenovo's performance with PCs is repeated in the server arena, HP's revenue is in danger of falling further."

"HP's share price is being propped high by stock buybacks and by high expectations for its 3D printing venture, but it does not hide the obvious long-term adverse impact of one particular item in the income statement, the unimpressive revenue figures.In my opinion, a PE of around 11 is entirely justified, but I fear there is more to go on the downward trend before the expected turnaround. This is a company that is shrinking, not expanding, and has to do more shrinking for some time to come."

Meg Whitman: Another Flip Flop Exposed

On April 1st, Vocativ released an article focusing on Meg Whitman. The article is called "Meg Whitman: The Other Tech CEO That Wanted to Ban Gay Marriage".

Another example of "quintessential Meg." Whether it's business goals or social issues, Meg Whitman is consistent in one regard: She makes statements that will further her goal on any given day, but changes course when it suits her. She supports banning gay marriage when she wants to get the conservative Republican vote but back tracks when she is running a company in Silicon Valley.

Tuesday, March 25, 2014

Article on Yahoo! Finance: Whitman stabilized HP but real growth still looks far off

I saw an article this afternoon posted on Yahoo! Finance titled "Whitman stabilized HP but real growth still looks far off".

Yaho Finance Article

The article touches on some key points, namely that even with the recent 3D printing foray announcement, there is nothing in her history which has instilled trust that it will actually come to pass.

In fact, there has not been one major announcement projecting growth that has happened. 

The author states, "In 2012, she was talking up amazing tablets that would storm the corporate market. And early in 2013, a new server technology dubbed Project Moonshot was all the rage. Neither has led to much revenue for HP yet, however".  

The article also discusses the botched Autonomy acquisition still casting a shadow.

It wraps up with a point I've stressed in this blog, being "Wall Street has already rewarded Whitman for Saving HP from oblivion. Now the question is whether she can move it forward".  

The answer is simply, no. She does not have the experience or the vision necessary to propel HP forward into a place of being able to compete, much less create and propel forward.