ValuationIntel and HP are both undervalued, especially when they are compared to ARM Holdings. HP has a forward P/E of 7, while Intel’s forward P/E is 13. By comparison, ARM trades at a lofty forward P/E of 46. Conclusion The recovery in HP is on track. Operational cost cuts will continue, but investor interest in HP will grow as the company realigns its focus on higher margin products. Haswell, the processor name for Intel’s new line of chips, will help boost PC sales. Windows 8.1, which will bring back a variant of the Start paradigm, will also raise interests in PCs.
Written by Chris Lau, Kapitall Contributor