Hewlett-Packard CompanyHPQ

Morningstar Rating

Stock Research and Analysis

by Michael Holt

Aggressive expansion of its product line and a shift to more complex technologies position Hewlett-Packard to win a higher percentage of IT spending from its vast customer base. The firm is refocusing efforts on its four key segments: enterprise technologies, Read more

Bulls Say

HP's global reach and well-run logistics provide an efficient platform to assimilate and distribute new technologies.

HP is effectively targeting technologies to acquire in storage and networking that will help it build an all-in-one portfolio for enterprise data centers.

The EDS acquisition instantly positioned HP to be a contender in enterprise services. Read more

Bears Say

The PC business faces declining average selling prices and substitute technologies that overwhelm our optimism for the expected short-term acceleration in the PC refresh cycle. Yet HP appears committed to this business, despite the exit of competitors like IBM.

Data center giants like Cisco are eyeing HP's traditional markets as opportunities to drive growth. Increased competition could bring margin pressure.

HP's virtualization strategy remains murky. It remains in question whether the firm will continue to favor VMware VMW or abandon the market leader because of its ties to Cisco and EMC EMC. Read more

Strategy

HP gets in the door by delivering excellent hardware solutions. However, instead of relying on hardware designs to keep customers engaged, HP's goal is to wrap the hardware into a bundle of software Read more

Management

Mark Hurd joined HP in March 2005 as CEO and was named chairman in September 2006. Hurd has aggressively pushed his agenda with success. Recent acquisitions, including EDS and 3Com, align with what we think is a solid strategy to shift HP's reliance Read more

Profile

Hewlett-Packard manufactures and sells information technology products and services to businesses and consumers worldwide. With the recent EDS acquisition, we estimate services Read more

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