HP Inc.: A Dividend Stock with Recovery Potential Amid Tariff Challenges

HP Inc. is a global tech company that develops and provides PC devices, printers, and related supplies and services. The stock has declined by ~30% over the past year due to tariffs. Despite this, the company has good recovery potential and a high dividend yield, making it an attractive investment option.

HP Inc. (HPQ) has experienced a significant downturn in its stock price over the past year, declining by approximately 30% [1]. This decline can be largely attributed to tariffs, which have increased costs and put pressure on the company's margins. Despite this challenging environment, HP Inc. continues to offer an attractive dividend yield of 4.5% [1], making it an intriguing investment option for those seeking income and potential growth.

The company has been adversely affected by tariffs, which have increased its costs and put pressure on its margins. Analysts have been generally bearish on the stock following HP's Q2 earnings report, which missed estimates and provided dismal guidance [1]. However, analysts anticipate that earnings will rise by high single digits in the next fiscal year, suggesting that the market may be pricing in a recovery [1].

HP Inc. is taking steps to mitigate the impact of tariffs by increasing its sourcing from countries outside of China. This strategy aims to reduce the cost burden associated with tariffs and potentially improve margins. The company's efforts to diversify its supply chain could be a positive sign for future performance.

Analysts remain divided on the stock's outlook. As of July 2, 2025, 14 analysts covering HPQ have provided ratings, with three rating it as a "Strong Buy," 10 rating it as a "Hold," and one rating it as a "Strong Sell." The stock currently trades slightly above its Street-low target price of $22, with a mean target price of $27.27 [1].

Investors should closely monitor HP Inc.'s progress in diversifying its supply chain and the potential impact on earnings as the company navigates through the challenges posed by tariffs. The stock's attractive dividend yield and the anticipated earnings recovery make it an interesting opportunity for investors seeking income and potential growth.

References:
[1] https://www.ainvest.com/news/hp-stock-21-2025-offers-4-5-dividend-yield-2507/