HP vs SP

HP (high potential) vs SP (steady performer) stocks represent two distinct investment strategies. HP stocks are characterized by high growth potential, often associated with emerging industries or innovative companies. On the other hand, SP stocks are known for their stable and consistent performance, typically found in established industries or companies with a proven track record. Investors must weigh the risks and rewards of each type of stock when building a diversified portfolio that aligns with their financial goals.

HP or SP?

When comparing HP and SP, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between HP and SP.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. HP has a dividend yield of 3.73%, while SP has a dividend yield of 0.94%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. HP reports a 5-year dividend growth of 12.96% year and a payout ratio of 37.71%. On the other hand, SP reports a 5-year dividend growth of -12.94% year and a payout ratio of 17.16%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with HP P/E ratio at 12.73 and SP's P/E ratio at 18.21. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. HP P/B ratio is -26.00 while SP's P/B ratio is 2.46.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, HP has seen a 5-year revenue growth of 0.50%, while SP's is 0.22%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with HP's ROE at -226.67% and SP's ROE at 14.24%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $36.84 for HP and kr318.50 for SP. Over the past year, HP's prices ranged from $25.67 to $39.52, with a yearly change of 53.95%. SP's prices fluctuated between kr171.80 and kr343.00, with a yearly change of 99.65%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.