He set a new price target of $15, up from $13, Barron's reported.
The shares of HPE, a supplier of IT infrastructure products and services, finished at $14.95 Monday.
HP Enterprise shares had slid 23% in 2019 through Friday and Daryanani views them as cheap. They trade at 8 times forward earnings and 9 times enterprise value to free cash flow, he calculates.
Daryanani likes the company's "cash flow resiliency," Barron's reports. He sees underlying free cash flow above $2 billion a year.
HPE's long-term target of more than $2.5 billion in annualized free cash flow is on the mark, he says.
HP Enterprise's $1.4 billion purchase of Cray in September could add to earnings per share, Daryanani says.
In addition, recent data indicate that H3C, a joint venture with China's Unisplendour, has been outselling competitors Cisco (CSCO - Get Report) and Dell (DELL) in China, he says, according to Barron's.