Why Are We Revising Our HPE Price Estimate To $20.55?

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We have recently revised our price estimate of Hewlett-Packard Enterprise (NASDAQ: HPE) from $17.08 to $20.55. Despite this price revision, our stock price estimate is 7% below the current market price of $22.07. The company has successfully entered a definitive agreement with CSC to create $26 billion solutions services company, which we will later reflect in our segementation.  HP continues to report double-digit growth in revenues of its strategic enterprise services such as cloud, mobility, security and big data. Converged cloud infrastructure built on technologies like converged storage, software-defined networking and the Moonshot server platform will power cloud computing by seamlessly integrating big data analytics and security. HP announced several new cloud services and cloud professional services based on its technology to bolster its cloud presence and feed business into its channel. It continues to work closely with its channel partners to improve their cloud go-to-market and delivery capabilities.  Based on the initiatives taken by HPE in Cloud domain, we believe that margins for the company will improve and have upgraded our price estimate for the company to $20.55. Our changes in drivers are as follows:

See our full analysis on HP

HPE Price Change

Have more Questions? Check Out some that we have answered:

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Notes:

1) The purpose of these analyses is to help the readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment / ask questions on the comments section.

2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our full analysis for Hewlett Packard Enterprise

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