Hewlett-Packard's Solo Flight

A better-than-expected fourth quarter would represent a major milestone in Hewlett-Packard's(HPQ Quote) turnaround -- particularly after rival Dell's(DELL Quote) recent woes.

But when H-P reports its financial results later Thursday, it also will have to convince investors that it can provide significant growth in the year ahead.

H-P and Dell appear to be on opposite trajectories. While Dell has seen its stock pushed down following back-to-back quarterly misses, H-P's stock is up more than 30% for the year, closing at $28.27 on Wednesday.

Much of this gain reflects investor confidence that the reorganization under CEO Mark Hurd is off to a good start. In August, H-P posted better-than-expected third-quarter results.

And the Street's consensus for the company's fourth quarter suggests another strong showing. Analysts polled by Thomson First Call are expecting H-P to earn 46 cents a share on revenue of $22.75 billion. That's at the high end of the company's own guidance, which pegs EPS between 44 cents and 47 cents and sales between $22.4 billion and $22.8 billion.

Goldman Sachs analyst Laura Conigliaro expects H-P to beat the Street by a penny on EPS, the result, according to a recent report, of "well-set expectations, solid execution and restructuring savings." Goldman has received compensation for investment banking services provided to H-P in the past 12 months.

Since taking over as CEO in March following the ouster of Carly Fiorina, Hurd has aggressively moved to reduce and reorganize. In July, he slashed headcount by 10%, or 14,500 workers. And he split apart the PC and printer businesses, making each an individual business division. Just as important, say some, he has instilled a much-needed culture of accountability within the company.

The fruits of these efforts might be more visible than expected in Thursday's results. Bill Gorman, vice president of equity research at PNC Advisors, says there could be a bit of an upside surprise on H-P's margins, thanks to cost-cutting efforts that appear to be targeted across a number of areas within the company.