HP Company rallies amid broad market sell off
SAN CO: Hewlett-Packard Company (NYSE:HPQ) shares surged as much as 5% in Friday's trading session, after it disclosed the financial results for its second quarter of financial year 2016 (2QFY16). Several Wall Street analysts have weighed in on the PC-maker following its relatively weaker quarterly performance.
Analysts at Cantor Fitzgerald reaffirmed a Hold rating on the stock, and revised the target price from $33 to $29. Cantor Fitzgerald has slashed its estimates primarily because of the weaker PC trends and increasing competition in the printing market. However, the research firm stays positive on the upcoming split that is scheduled for November 1.
The PC-maker delivered a mixed performance for the quarter; it reported adjusted earnings per share (EPS) of $0.88 that came ahead of its estimates of $0.85. However, revenue clocked in at $25.3 billion, which narrowly missed its revenue estimates of $25.4 billion. Analysts at Pacific Crest have reiterated a Sector Weight rating without assigning any target price to HPQ. Additionally, Pacific Crest also slashed its revenue and EPS estimates based on the high degree of demand uncertainty and currency headwinds across its three largest market segments. However, unlike Cantor and Pacific Crest, Jefferies has maintained a bullish stance on the stock, with a price objective of $40. Jefferies believes that HPQ shares will still continue to grind higher in the coming weeks, as the uncertainty around free cash flow outlook is alleviated. Despite reporting sluggish revenue growth, Hewlett-Packard rallied in the last trading session.