Zacks Investment Research cut shares of Hewlett Packard Enterprise (NYSE:HPE) from a strong-buy rating to a hold rating in a research note issued to investors on Friday morning.
According to Zacks, “We are encouraged by Hewlett Packard’s massive restructuring initiatives. On one hand, it is offloading low-margin businesses such as Enterprise Services and Software, which, in our opinion, will improvise the company’s margins over the long run. And on the other hand, it is enhancing its capabilities in the hybrid IT model as evident from the acquisitions of SimpliVity, Cloud Cruiser and Nimble Storage. We believe that the company’s focus on hybrid IT model will drive growth over the long run. Nonetheless, we remain slightly cautious about the company’s near-term prospects due to the three main challenges it is currently facing — heightened pressure competitive pricing, elevated commodities pricing and some near-term execution issues. These headwinds are expected to thwart its overall performance in the near term. The stock has underperformed the industry in a year’s time.”
A number of other equities research analysts have also recently commented on the company. Deutsche Bank increased their target price on Hewlett Packard Enterprise from $16.00 to $19.00 and gave the stock a buy rating in a research note on Monday, January 29th. Gabelli reissued a buy rating on shares of Hewlett Packard Enterprise in a research note on Wednesday, November 22nd. Maxim Group increased their target price on Hewlett Packard Enterprise from $15.00 to $17.00 and gave the stock a hold rating in a research note on Friday, February 23rd. Pivotal Research reaffirmed a hold rating and set a $20.00 price target (up from $13.00) on shares of Hewlett Packard Enterprise in a report on Friday, February 23rd. Finally, OTR Global downgraded Hewlett Packard Enterprise to a positive rating in a report on Tuesday, February 13th. Two investment analysts have rated the stock with a sell rating, nineteen have assigned a hold rating and eleven have given a buy rating to the company. The stock currently has an average rating of Hold and a consensus price target of $17.46.
Hewlett Packard Enterprise (NYSE:HPE) last released its earnings results on Thursday, February 22nd. The technology company reported $0.34 EPS for the quarter, topping analysts’ consensus estimates of $0.22 by $0.12. Hewlett Packard Enterprise had a return on equity of 7.40% and a net margin of 4.52%. The firm had revenue of $7.70 billion for the quarter, compared to analysts’ expectations of $7.07 billion. During the same period in the prior year, the firm posted $0.45 earnings per share. The company’s quarterly revenue was up 11.6% on a year-over-year basis. equities research analysts anticipate that Hewlett Packard Enterprise will post 1.4 EPS for the current year.
Hewlett Packard Enterprise declared that its board has authorized a share repurchase plan on Thursday, February 22nd that permits the company to repurchase $5.50 billion in outstanding shares. This repurchase authorization permits the technology company to reacquire shares of its stock through open market purchases. Shares repurchase plans are typically an indication that the company’s board believes its shares are undervalued.
The company also recently announced a quarterly dividend, which will be paid on Wednesday, April 4th. Shareholders of record on Wednesday, March 14th will be issued a $0.075 dividend. This represents a $0.30 dividend on an annualized basis and a yield of 1.60%. The ex-dividend date of this dividend is Tuesday, March 13th. Hewlett Packard Enterprise’s dividend payout ratio is 31.91%.
In other news, Director Margaret C. Whitman sold 674,000 shares of the firm’s stock in a transaction dated Thursday, March 8th. The stock was sold at an average price of $19.14, for a total value of $12,900,360.00. Following the transaction, the director now owns 2,167,693 shares of the company’s stock, valued at $41,489,644.02. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, insider Philip Davis sold 16,405 shares of the firm’s stock in a transaction dated Tuesday, February 27th. The stock was sold at an average price of $18.51, for a total value of $303,656.55. Following the completion of the transaction, the insider now directly owns 5,665 shares in the company, valued at approximately $104,859.15. The disclosure for this sale can be found here. In the last three months, insiders sold 2,760,834 shares of company stock worth $49,109,532. 1.18% of the stock is owned by corporate insiders.
Hedge funds and other institutional investors have recently bought and sold shares of the company. Newman Dignan & Sheerar Inc. bought a new position in shares of Hewlett Packard Enterprise in the fourth quarter worth about $207,000. BB&T Securities LLC bought a new position in shares of Hewlett Packard Enterprise in the third quarter worth about $156,000. Daiwa SB Investments Ltd. bought a new position in shares of Hewlett Packard Enterprise in the fourth quarter worth about $156,000. Clear Harbor Asset Management LLC bought a new position in shares of Hewlett Packard Enterprise in the fourth quarter worth about $158,000. Finally, Empirical Financial Services LLC bought a new position in shares of Hewlett Packard Enterprise in the fourth quarter worth about $159,000. 82.97% of the stock is currently owned by hedge funds and other institutional investors.
COPYRIGHT VIOLATION WARNING: This report was originally published by StockNewsTimes and is the property of of StockNewsTimes. If you are reading this report on another site, it was illegally copied and republished in violation of international copyright and trademark legislation. The correct version of this report can be read at https://stocknewstimes.com/2018/03/19/zacks-investment-research-lowers-hewlett-packard-enterprise-hpe-to-hold.html.
About Hewlett Packard Enterprise
Hewlett Packard Enterprise Company is a provider of technology solutions. The Company’s segments include: Enterprise Group, Software, Financial Services and Corporate Investments. The Enterprise Group segment provides its customers with the technology infrastructure they need to optimize traditional information technology (IT).
For more information about research offerings from Zacks Investment Research, visit Zacks.com
Receive News & Ratings for Hewlett Packard Enterprise Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Hewlett Packard Enterprise and related companies with MarketBeat.com's FREE daily email newsletter.