HP Inc. (NYSE:HPQ) hosted its 2023 security analyst meeting at its headquarters in Palo Alto on Tuesday, with Wall Street analysts stating the company's guide was largely in line with consensus.
In a note, Citi analysts maintained a Neutral rating on the stock, telling investors that while improving PCs is positive, the heightened competitive intensity in print remains a near-term risk.
"HP's FY24E guide was largely in line with consensus expectations of non-GAAP EPS of $3.45 and $3.35 bln in FCF," the analysts explained. "PC refresh cycle is a positive for earnings and FCF generation though near-term competitive intensity in Print remains a concern with guide assuming continued challenges in supplies offset with growth in print hardware as supply availability eases."
Morgan Stanley's analysts maintained an Equal-Weight rating on HPQ shares but raised the price target to $31 from $30 per share.
"Mgmt's FY24 (and LT) outlook was largely in-line with Street, and while we cut our rev forecast slightly, we raise our EPS due to stronger margins. HPQ's largest shareholder selling his stake caps valuation in the near-term, but we see upside to our $31 PT over the next 12mo, keeping us EW-rated," the analysts said.
Barclays analysts maintained an Underweight rating and a $23 price target on HPQ.
The analysts said the firm is slightly more bearish about end market growth. "We see longer-term secular challenges to the printing and PC businesses following the near-term boost related to COVID-19; these include falling print volumes and limited incremental opportunity for PC market share gains," the analysts noted, who also pointed out the continued share sale by Berkshire presents risks.
Analysts at Wells Fargo maintained an Underweight rating and a $25 price target on the stock. They wrote: "While we maintain our relative-driven UW rating on HPQ, we think HP's SAM update could be considered net-positive — i.e., roughly unchanged LT model framework; in-line non-GAAP EPS & FCF guide, and an implied resumption of share repo."