HP comfortably beat Wall Street's estimates in its second quarter last month, boosted by better-than-expected performance in Enterprise Services and Printing, as well as savings from restructuring and improved operations.
Marshall, however, warned that investors should not get too carried away, despite Whitman's progress. "In our view, HPQ has been making solid progress on its "fix and rebuild" process this year but a return to top-line growth and margin expansion next year will prove more difficult as higher-value segments (e.g., software and services) continue to face competitive pressure and PCs/Printing are secularly challenged."
During the second quarter, for example, revenue from HP's Personal Systems Group declined 20% from the prior year's quarter, underlining the challenges posed by PC market.
Marshall maintained his "neutral" rating on HP.--Written by James Rogers in New York. Follow @jamesjrogers >To submit a news tip, send an email to: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV