“HP announced solid [fiscal 2021 third quarter ended July 31] results and forward guidance,” Jefferies analyst Kyle McNealy wrote in a commentary. “We continue to see a strong demand environment, driven by virtual/hybrid work turning HP’s PC and print businesses into stable to growth businesses.”
Still, “component supply will remain a constraint for additional market unit growth, and we expect HP’s share gain and expansion opportunities to be key drivers for the business.”
McNealy kept his hold rating and $31 price target on the stock.
HP recently traded at $27.75, down 5%. The price has barely changed over the past six months.
As for Credit Suisse, analyst Matthew Cabral maintained his neutral rating and $30 target price.
“Sustainability remains the key debate for HP, and Thursday’s mixed results and comments on EPS growth likely weren’t enough soothe bears’ concerns heading into fiscal year 2022,” he said.
That makes the October analyst meeting “a key upcoming catalyst for the stock,” Cabral said. “We continue to believe it’s prudent to factor in some normalization heading into next year, both on PC/print demand (particularly on the consumer side) and the margin outlook.”
That comes as “pricing power fades vs. rising input costs, though [we] remain neutral against buybacks of more than $1 billion per quarter,” he said.
On Thursday, Morningstar analyst Mark Cash raised his fair value estimate to $25 from $23 after the earnings report.