HP Inc. Downgraded with Moderate Price Target Upside Potential

A recent report indicates that HP's outlook was downgraded by B of A Securities from 'Buy' to 'Neutral'. Despite this shift, the average one-year price target suggests a modest upside of 1.00%, alongside a revenue growth projection of 7.22% and a non-GAAP EPS forecast of 3.64.

Date: 29-09-2024

AI Rating: 5

The report highlights several key points that could influence HP's stock price. The downgrade by B of A Securities from 'Buy' to 'Neutral' could lead to a decrease in investor confidence, potentially affecting the stock negatively.

The average one-year price target of 32.12€ per share, reflecting a slight upside of 1.00% from its current trading price of 31.80€, implies that analysts expect limited growth potential in the near term. This modest outlook may keep investors cautious in the immediate future.

HP's projected annual revenue is 57,169MM, which represents a growth of 7.22%. This indicates a healthy expectation for sales, which could be a positive sign for investors seeking growth in revenue generation. Additionally, the projected non-GAAP Earnings Per Share (EPS) is 3.64. This figure provides insight into HP's profitability potential, which, alongside the revenue growth, may mitigate concerns arising from the downgrade.

The report mentions significant activity among institutional investors, with 2,022 funds reporting positions in HP, reflecting a 6.25% increase in fund ownership in the last quarter. This increase in institutional interest and a rise in average portfolio weight (up by 21.52%) might suggest confidence in HP's long-term prospects despite the recent downgrade.

However, individual institutional movements show mixed signals. For example, Dodge & Cox decreased their shareholding slightly, while Bank of America increased its ownership significantly but reduced its overall portfolio allocation to HP sharply. The variations among major shareholders could create uncertainty regarding the company's future direction.

Overall, while the downgrade poses a challenge for HP, the combination of revenue growth, EPS expectations, and strong institutional interest could support the stock's price stability, making it a potentially interesting option for investors monitoring HP's progress.

Stocks: HPQ