Morningstar Rating

Stock Research and Analysis

by Peter Wahlstrom, CFA

Bulls Say

HP's global services reach and well-run logistics provide an efficient platform to assimilate and distribute new technologies.
HP's enterprise hardware and software businesses sell higher-margin, sticky products such as networking equipment storage arrays and management tools.
Management has maintained achievable expectations (projecting another drop in free cash flow this year) and hopes to clear a low bar. Read more 

Bears Say

The PC business faces declining average selling prices and substitute technologies that could overwhelm optimism for a short-term acceleration in the PC refresh cycle.
Data center giants like Cisco continue to watch HP's traditional markets as opportunities to drive growth. Increased competition could bring margin pressure.
HP's R&D investment and acquisition spending has recently trailed its large enterprise competitors by a wide margin. The firm may need to invest heavily over the next few years to remain competitive. Read more 

Management

We view HP's stewardship of shareholder capital as standard, driven by recent improvements and our belief that Meg Whitman is committed to the firm's turnaround. Whitman was appointed CEO in September 2011, replacing Leo Apotheker after his less than   Read more 

Profile

Hewlett-Packard manufactures and sells information technology products and services to businesses and consumers worldwide. Services account for about 20% of revenue, enterprise   Read more 

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The Friday Five: HP Progresses; Target Misses the Mark 
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