Hewlett Packard Enterprise (HPE) Stock: $16 Price Target From BofA Securities

By Amit Chowdhry ● May 22, 2022
  • The shares of Hewlett Packard Enterprise Co (NYSE: HPE) have received a $16 price target from BofA Securities. These are the details.

The shares of Hewlett Packard Enterprise Co (NYSE: HPE) have received a $16 price target from BofA Securities. And BofA Securities analyst Wamsi Mohan adjusted the rating on HP Enterprise from a “Buy” rating to a “Neutral” rating.

Mohan adjusted the rating while citing that the large backlog creates risks.

“Given a worsening supply chain due to recent China lockdowns (negative commentary from Cisco, continued logistical challenges from protracted lockdowns), we expect negative estimate revisions and we are incrementally worried about order deceleration. We see some risk to HPC revs from slower customer acceptance and associated margin pressure. We move our rating to Neutral and our PO to $16 (from $19) on 8x C23 EPS (prior 9x C22 EPS). We roll over to C23-based valuation,” wrote Mohan in a research note. “Our Neutral rating is based on risk-reward balance: positives include mix shift to high-margin software/SaaS (software as a service) revs and optionality linked to H3C put balanced by risk from economic slowdown, component shortages & high backlog, which is cancellable. Upside risks: macro/supply chain recovery. Downside risks: longer slowdown, increased competition.”

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