HP Unveils AI Devices Amid Deteriorating PC Market

Written by Emily J. Thompson, Senior Investment Analyst

Source: seekingalpha

Updated: 4 days ago

0mins

HPQ+0.62%

Should l Buy HPQ?

Source: seekingalpha

New Hardware Launch: At the Imagine event, HP introduced a lineup of high-powered workstations, AI PCs, and laptops aimed at enhancing hybrid work efficiency; however, these new devices failed to significantly improve market performance, reflecting the ongoing weakness in the PC sector.
Deteriorating Market Outlook: Morgan Stanley analysts highlighted that the challenges facing HP and the broader PC industry are intensifying, including rising memory prices and shortages, CPU supply constraints, and price hikes, leading to a more pessimistic outlook for the next 12 months.
Shipment Forecast Downgrade: Morgan Stanley revised its global PC shipment forecast from a previous expectation of flat to -5% year-over-year declines to a projected 16% decline, indicating a sharp drop in market demand, particularly evident in weakening notebook ODM builds.
Rating and Price Target Maintained: Despite HP shares rising nearly 4% in Wednesday trading, Morgan Stanley maintained its Underweight rating and $16 price target on HP, reflecting a cautious stance on the company's future performance.

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Analyst Views on HPQ

Wall Street analysts forecast HPQ stock price to rise

14 Analyst Rating

1 Buy

10 Hold

3 Sell

Hold

Current: 19.440

Low

20.00

Averages

25.30

High

30.00

Current: 19.440

Low

20.00

Averages

25.30

High

30.00

BofA

Underperform

downgrade

$18 -> $16

2026-02-25

Reason

BofA

Price Target

$18 -> $16

AI Analysis

2026-02-25

downgrade

Underperform

Reason

BofA lowered the firm's price target on HP Inc. to $16 from $18 and keeps an Underperform rating on the shares. HP delivered a roughly inline fiscal Q1 and upheld FY26 guide for EPS and free cash flow, but clarified both will be towards the low-end of the previously guided ranges, the analyst tells investors. The firm says its Underperform rating reflects the "coinciding headwinds" of slower PC unit growth, margin pressure from memory costs, and uncertainty from the leadership transition.

JPMorgan

Neutral

downgrade

$21 -> $19

2026-02-25

Reason

JPMorgan

Price Target

$21 -> $19

2026-02-25

downgrade

Neutral

Reason

JPMorgan lowered the firm's price target on HP Inc. to $19 from $21 and keeps a Neutral rating on the shares post the fiscal Q1 report. The firm says memory headwinds challenge the company's earnings outlook.

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About HPQ

HP Inc. is a global provider of sustainable devices, services and subscriptions for personal computing (PC), printing, three-dimensional (3D) printing, hybrid work, gaming and other related technologies. The Company’s segments include Personal Systems, Printing and Corporate Investments. Its Personal Systems segment offers desktops, notebooks, and workstations, thin clients, retail point-of-sale (POS) systems, displays, hybrid systems, software, solutions including endpoint security and services. Its Printing segment provides consumer and commercial printer hardware, supplies, services and solutions. Printing is also focused on graphics and 3D printing and personalization in the commercial and industrial markets. Its Corporate Investments segment includes certain business incubation and investment projects. Its security solutions provide layered resiliency using features such as containment and isolation technology as well as artificial intelligence (AI) deep learning.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.

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