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) - Get Report in China, he says, according to Barron's.
This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.