This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

HP: Expect PC Pressure

NEW YORK ( TheStreet) - HP (HPQ - Get Report) reports its third-quarter results after market close on Wednesday hot on the heels of underwhelming quarterly numbers from arch PC rival Dell (DELL - Get Report).

With Dell noting a "challenging" environment for PC sales, it's doubtful that HP, as the no.1 PC maker, will be able to escape feeling the same strain.

"We expect Hewlett-Packard to discuss similar challenges around its PC business this evening," explained Brian White, an analyst at Topeka Capital Markets, in a note released on Wednesday.

Jayson Noland, an analyst at Baird Equity Research, also thinks that PCs could pose a problem for HP. "We anticipate the company will continue to report soft revenue given significant exposure to Consumer PCs, challenges in Server, and structural issues in Services," he explained, in a recent note.

Analysts surveyed by Thomson Reuters expect HP to report sales of $30.1 billion and earnings of 98 cents a share, down from $31.2 billion and $1.10 a share in the same period last year.

HP, however, comfortably beat Wall Street's estimates with its second quarter results, winning plaudits for CEO Meg Whitman.

Nonetheless, the numbers suggest that HP's PC business was hardly booming during the quarter. Revenue from the company's Personal Systems Group (PSG) came in at $9.5 billion, flat compared to the same period last year. Within PSG, HP's notebook PC revenue was down 3% on the prior year's quarter, while desktop PC sales climbed 5%.

Topeka Capital Markets' White thinks a big miss may be in the offing.

"We believe HP will meaningfully miss our PC sales forecast that calls for notebook computing sales to fall by 2% quarter-over-quarter and desktop PC revenue to be flat sequentially," he wrote, in a note released on Tuesday. "In fact, we believe the PC sales miss could be as high as $1 billion."

White, who has a hold rating and $23.50 price target on HP, predicts PSG revenue of $9.358 billion.

TheStreet will be live-blogging HP's third-quarter earnings, starting at 3.45PM ET:

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
DELL $0.00 0.00%
HPQ $34.01 -1.90%
AAPL $130.13 1.00%
FB $80.72 1.50%
GOOG $555.10 2.10%

Markets

DOW 18,214.42 -10.15 -0.06%
S&P 500 2,110.74 -3.12 -0.15%
NASDAQ 4,987.89 +20.7530 0.42%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs