HPE's Financial Surge Led By AI Demand Despite Margin Pressures, Analysts Optimistic About Future Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 05 2024
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Source: Business Insider
- Hewlett Packard Enterprise Q2 Financial Results: Shares trading higher after beating analyst estimates with quarterly earnings of 42 cents per share.
- Outlook and Projections: Company expects third-quarter EPS of $0.43-$0.48 and full-year EPS of $1.85-$1.95, with anticipated improvements in storage margins.
- Analyst Insights - Goldman Sachs: Storage margins showed weakness due to transition to as-a-service model, but improvements expected; Intelligent Edge revenue growth expected in the second half of the fiscal year.
- Analyst Insights - JP Morgan: Results reflect AI demand driving revenue growth, but margins affected by AI servers and pricing pressures; increased revenue forecast and EPS estimates for FY24 and FY25.
- Investor Opportunities: Analysts revise forecasts on Hewlett Packard Enterprise, suggesting exposure through specific ETFs; HPE shares up 11.91% at $19.71.
Analyst Views on HPE
Wall Street analysts forecast HPE stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for HPE is 27.13 USD with a low forecast of 21.00 USD and a high forecast of 31.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
16 Analyst Rating
8 Buy
8 Hold
0 Sell
Moderate Buy
Current: 21.360
Low
21.00
Averages
27.13
High
31.00
Current: 21.360
Low
21.00
Averages
27.13
High
31.00
About HPE
Hewlett Packard Enterprise Company is a global technology company focused on developing intelligent solutions that allow customers to capture, analyze and act upon data seamlessly from edge to cloud. Its customers range from small-and-medium-sized businesses to large global enterprises and governmental entities. Its segments include Server, Hybrid Cloud, Networking, Financial Services, and Corporate Investments and Other. Its Server segment offerings consist of general-purpose servers for multi-workload computing, workload-optimized servers, and integrated systems. Its Hybrid Cloud segment offers a range of cloud-native and hybrid solutions across storage, private cloud and the infrastructure software-as-a-service space. The Networking segment develops and sells high-performance networking and security products and services. Its Financial Services segment provides flexible investment solutions, such as leasing, financing, IT consumption, utility programs, and asset management services.
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.
