Hewlett Packard Enterprise (HPE: NYE) reported mixed results for its Q1 of fiscal 2024. The mixed results posed new questions about the future performance of HPE’s stock.
Key Highlights from Hewlett’s Q1 Earnings:
Here are the key Insights from the Q1 report of Hewlett Packard Enterprise
- Earnings beat estimates: HPE reported adjusted EPS of $0.48, exceeding analyst estimates of $0.45. However, this represented a decrease of 23.8% compared to the same quarter last year.
- Revenue misses expectations: Despite exceeding EPS expectations, HPE’s net revenue of $6.76 billion fell short of analyst estimates of $7.09 billion and represented a 13.5% decline year-over-year.
- Mixed performance across segments: HPE’s Intelligent Edge segment saw a 3% year-over-year revenue increase, while the newly formed Server segment experienced a 23% decline. The Hybrid Cloud segment also reported a 10% decrease in revenue compared to the prior year period.
Following the announcement of these results, Hewlett Packard Enterprise’s stock dipped about 2% in after-hours trading, which might be a fresh source of worry for investors despite the earnings per share exceeding expectations.
Stock Target Advisor’s View on Hewlett Packard Enterprise:
Stock Target Advisor rates HPE as a Buy with a target price of $17. We are projecting an approximate 11.62% price change over the next 12 months. If we look at the ratings from analysts, HPE maintains a Hold rating with an average target price of $17.00. In terms of investment signals, we detect a Slightly Bullish sentiment, backed by 8 positive signals and 4 negative signals.
04 analysts covering HPE, an average rating holds at Hold with a price target ranging from $15 to $20. The Communication Equipment sector, where HPE operates, has evidenced mixed returns over the past month and week, and Stock Target Advisor currently rates HPE as Neutral in this sector.
Conclusion:
HPE’s Q1 results paint a picture of a company navigating a challenging market environment. While the company exceeded EPS expectations, the overall revenue decline and mixed performance across segments raise concerns for investors.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
