Hewlett-Packard Heads To $39 With Converged Cloud For Big Businesses

-47.92%
Downside
37.34
Market
19.45
Trefis
HPQ: Hewlett logo
HPQ
Hewlett

Hewlett-Packard (NYSE:HPQ) has announced an initiative called the HP Converged Cloud, which has been set up to take advantage of large corporations looking to their move computing needs to the cloud. It claims that this product will in essence converge traditional IT infrastructure with a cloud-based infrastructure to provide seamless transition from legacy to cloud systems. [1] This will help it challenge other cloud players including  IBM (NYSE:IBM) and Amazon (NASDAQ:AMZN) among others.
See our full analysis on HP

Battle For Cloud Domination

Large corporations are looking to cut down IT costs and have more control over their IT systems. The move to cloud computing has been driven mainly by lower running costs and maintenance compared to the current systems. It also allows for better control and security as the end users are served information remotely.

Relevant Articles
  1. HP Stock Outperformed Dell Amid AI-Fueled PC Recovery. Is It The Better Bet?
  2. Up 5% In A Fortnight, Can HP Inc. Stock Continue Outperforming The Market?
  3. What’s Next For HP Inc. Stock After Dropping 5% Last Week?
  4. Buy HP Inc. Stock For 25% Upside?
  5. Has HP Inc. Stock Peaked At $17?
  6. Here’s Why Hewlett-Packard’s Stock Could Touch $10

Enterprise software players sense this need and have set themselves up to meet demand. Dell (NASDAQ: DELL) has been making acquisitions to meet this requirement. Other major players include Amazon, with its Web Services offering, while IBM and HP are poised to be serious contenders with products in the public cloud domain and services to build and maintain private clouds.

OpenStack Gets More Backing

OpenStack is an open source Infrastructure as a Service (IaaS) cloud computing project by Rackspace Cloud and NASA, and is fast becoming the technology of choice for most companies looking to offer products in the cloud computing space. HP’s Cloud Services will run the OpenStack technology as well.

We currently have a $39 Trefis price estimate for HP, which is around 40% ahead of the market price.

Understand How a Company’s Products Impact its Stock Price at Trefis

Notes:
  1. Hewlett-Packard: Once More Toward the Cloud, NY Times Blog, April 10, 2012 []