Liberty Posted August 18, 2011 Share Posted August 18, 2011 http://www.bloomberg.com/news/2011-08-18/hp-said-to-be-near-10-billion-autonomy-takeover-spinoff-of-pc-business.html Hewlett-Packard Co. (HPQ), the world’s largest computer maker, is in talks to buy Autonomy Corp. for about $10 billion and plans to spin off its personal-computer business, people with direct knowledge of the matter said. Link to comment Share on other sites More sharing options...
DCG Posted August 19, 2011 Share Posted August 19, 2011 Sows the same struggle companies like Dell are having. PC's are a commodity. HPQ is also shutting down Web OS. What a complete waste of over $1.2 billion. They can't compete with Apple and Google. -and their printers are awful. I want to toss my HPQ printer out the window on a daily basis. Link to comment Share on other sites More sharing options...
username Posted August 19, 2011 Share Posted August 19, 2011 -and their printers are awful. I want tO toss my HPQ printer out the window on a daily basis. In case you print in black and white, I would recommend Xerox. My girlfriend moved in with her "all in one" HP. Every now and then i see her using my simple yet stable printer. ;D Link to comment Share on other sites More sharing options...
cayale Posted August 19, 2011 Share Posted August 19, 2011 Granted, some aspects of its business are very difficult and can make anybody look bad. However, I am just amazed at what this seemingly "superstar" board has presided over for the past decade: multiple dumb, overpriced acquisitions, poor execution, a scary battery of executives, pre-texting, in-fighting, the list could go on... Link to comment Share on other sites More sharing options...
rjstc Posted August 19, 2011 Share Posted August 19, 2011 Now they have announced they are buying an offshore company like Microsoft did to utilize money held out of the US. Paying 10 times sales with stock that is been hammered. Brilliant business move. Link to comment Share on other sites More sharing options...
Myth465 Posted August 19, 2011 Share Posted August 19, 2011 I never understood the palm acquisition..... Link to comment Share on other sites More sharing options...
cayale Posted August 19, 2011 Share Posted August 19, 2011 Compaq, then EDS, then Palm, 3PAR, now Autonomy. All at silly prices with poorly executed integrations, lost/shrinking business (except maybe compaq). Outrageous. Link to comment Share on other sites More sharing options...
Myth465 Posted August 19, 2011 Share Posted August 19, 2011 Damn HP is getting killed today..... Link to comment Share on other sites More sharing options...
cayale Posted August 19, 2011 Share Posted August 19, 2011 They've bet the company twice with Compaq and EDS, both to their detriment. It seems the market does not trust them to try and pull it off the third time- for good reason. Link to comment Share on other sites More sharing options...
Viking Posted August 19, 2011 Share Posted August 19, 2011 Makes one appreciate one of Buffett's comments in the recent AR about how to value BRK: how well retained earnings are re-invested over time. Makes BRK look even better. Watching HPQ makes one wonder how to value all that cash that many tech companies are holding. MSFT and GOOG recent purchases also gives one pause. Link to comment Share on other sites More sharing options...
zarley Posted August 19, 2011 Share Posted August 19, 2011 Here's a link to the BOD: http://h30261.www3.hp.com/phoenix.zhtml?c=71087&p=irol-govboard Most haven't been on the board very long. Other than Andreesen and maybe Whitman, it seems to be filled with non-descript c-suite flunkies, private equity and software people. No wonder HPQ is so screwed up. Who are the owners that voted in that board? http://moneycentral.msn.com/ownership?symbol=HPQ&Holding=5%25+Ownership Looks like it's all institutional ownership, insiders own less than 1%. Might be the poster-child for what happens when the owners are entirely detached from the running of the business. Kind of amazing really, given its history as a partnership / start-up. Link to comment Share on other sites More sharing options...
Liberty Posted August 19, 2011 Author Share Posted August 19, 2011 Wow, down 20%. Mr. Market really doesn't feel good about this. Out of curiosity, what do the HPQ shareholders on this board (and there seems to be many of those) think about this, and are you backing up the truck or reconsidering your investment? Link to comment Share on other sites More sharing options...
opihiman2 Posted August 19, 2011 Share Posted August 19, 2011 I do not understand the Autonomy acquisition. It is almost as bad as the Skype acquisition by MSFT, and both makes me question the leadership and long term returns of either company. 1) I do know some people at Autonomy and they liken their search appliance to a piece of junk. Google's search supposedly does a much better job and they have the mantra of "do no evil". Autonomy has no moral qualms about throwing you under the bus and will actively collect personal data and sell it. 2) Why is HPQ buying a company that has a $3.4 billion market cap for $10 billion??? 3) How does this acquisition make any sense for HPQ? They look like they are trying to make a run at IBM by leveraging into the software business, but IBM's acquistions at least made sense to their overall software portfolio: webservices, business process management, software development, J2EE and Java. I just don't understand how Autonomy makes any sense for HP's overall strategy. It seems that HPQ is trying to become the next Yahoo. Everything it touches just turns to crap. And it is sad that after 10 years of bad management, they will probably head the way of Sun. I will not pay any money for a company with a decent franchise but horrible management. The market is making a good call on this one. I think HPQ should head to the teens. Link to comment Share on other sites More sharing options...
S2S Posted August 19, 2011 Share Posted August 19, 2011 Guess who holds (or held) 23 million of HPQ shares? http://on.wsj.com/oR0beI Based on back of the envelope math, Paulson’s paper loss on H-P is more than $500 million. More forced selling must be happening just now... stay tuned. Link to comment Share on other sites More sharing options...
goldfinger Posted August 19, 2011 Share Posted August 19, 2011 Wow, down 20%. Mr. Market really doesn't feel good about this. Out of curiosity, what do the HPQ shareholders on this board (and there seems to be many of those) think about this, and are you backing up the truck or reconsidering your investment? I left the boat yesterday and reallocated in other stocks. Link to comment Share on other sites More sharing options...
rranjan Posted August 19, 2011 Share Posted August 19, 2011 Reaction is over done in my opinion. It's not as if they are forecasting a loss. Link to comment Share on other sites More sharing options...
goldfinger Posted August 19, 2011 Share Posted August 19, 2011 Reaction is over done in my opinion. It's not as if they are forecasting a loss. You are right. But I can't see any consistency in management communications and decisions... Link to comment Share on other sites More sharing options...
rranjan Posted August 19, 2011 Share Posted August 19, 2011 Yes, management is weak spot here but HP is overpaying by spending $10B for Autonomy Corp. and lost more than that $10B in market cap today. So current buyers will have Autonomy corp free thrown with existing businesses. Around 5 times FCF , I think reaction is over done here. Jut my opinion. Link to comment Share on other sites More sharing options...
given2invest Posted August 20, 2011 Share Posted August 20, 2011 I'd rather own DELL or RIMM at the same valuation. HPQ management is awful and this acquisition is even worse. This is exactly why you can't value $1 of tech FCF at $1. They spend the money on the stupidest shit. 60+% market premium so they can diversify into a better business? WTF? Link to comment Share on other sites More sharing options...
sswan11 Posted August 20, 2011 Share Posted August 20, 2011 From Credit Suisse analyst report, dated today: The multiple HP trades on today does not give much credit. Even on our lower estimates HP trades on a P/E of 6x, this is at an 42% discount to the market, and 29% below Dell and 44% below IBM. A glance at Exhibit 3 shows that the company is trading at the highest discount to IBM than in the past five years and the lowest multiple ever on earnings. Post these strategic moves, HP will offer comparable margins to IBM assuming limited synergies. This could allow shares command a higher multiple and allow scope for rerating. Exhibit 2: HP trades on 6x forward P/E…a 20 year low Exhibit 3: …and a 50% discount to IBM SOTP valuation suggests break-up value above $40. With the proposed separation/spinoff of the PSG business, investors will increasingly need to value the company on a SOTP basis or in terms of break-up value. As we show in Exhibit 4, at a share price of ~$25, the market may be valuing the entire consumer business (PC and Printing) at near zer Link to comment Share on other sites More sharing options...
opihiman2 Posted August 20, 2011 Share Posted August 20, 2011 Just a heads up. Anyone who has been interested in a tablet device should go to HP now! They dropped the 16gb Touchpad to $99 and the 32gb to $149. The 16gb are out of stock, but you can still get the 32gb. If you add a $6 filler item such as the multipurpose 8x11 paper, you can use the save30hp code and save $30 more on the 32gb model. If there is one good thing about this HP fiasco, this is IT. BTW, these were retailing for $400 and $499 just earlier today. Link to comment Share on other sites More sharing options...
Rabbitisrich Posted August 20, 2011 Share Posted August 20, 2011 I couldn't land the $99 version, but I did pay up at Office Deopt. $129.99, $141 after taxes, for a product that may cost $318 to produce. Link to comment Share on other sites More sharing options...
opihiman2 Posted August 20, 2011 Share Posted August 20, 2011 I couldn't land the $99 version, but I did pay up at Office Deopt. $129.99, $141 after taxes, for a product that may cost $318 to produce. Man, go back and have them price match Walmart. Local walmarts are selling the 16gb version for $99. I just picked up a whole bunch. Link to comment Share on other sites More sharing options...
Myth465 Posted August 20, 2011 Share Posted August 20, 2011 I just ordered 1...... Link to comment Share on other sites More sharing options...
Guest Posted August 20, 2011 Share Posted August 20, 2011 I went to walmart (gone), best buy (gone) and finally found a couple at HH Greg. Man, this is a sweet deal! Myth, where did you order yours? Link to comment Share on other sites More sharing options...
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