Hewlett Packard Enterprise (HPE): Guidance Could Be Difficult - Wells Fargo

November 21, 2016 7:50 AM EST
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Price: $22.88 +0.48%

Rating Summary:
    12 Buy, 9 Hold, 3 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Wells Fargo analyst, Maynard Um, reiterated his Market Perform rating on shares of HP Enterprise (NYSE: HPE) and expects FQ4 results to be ahead of the Street’s expectations for $12.8B/$0.60.

The focus is expected to be on the fundamentals of the core enterprise server and storage segments, as well as commentary around the potential impact of the strengthening dollar on guidance (USD appreciated by a mid-single-digit % against most major currencies since
September 30).

The analyst believes the midpoint of FQ1 EPS guide could end up below Street’s $0.46 (noting CEO Meg Whitman has not missed a quarter, in part due to conservative guide). To guide midpoint at $0.46, operating margin in Enterprise Services (ES) and Enterprise Group (EG)
would have to be ahead of expectations which the analyst believes could be difficult,
particularly given divestitures of higher margin businesses, as well as seasonality.

For an analyst ratings summary and ratings history on HP Enterprise click here. For more ratings news on HP Enterprise click here.

Shares of HP Enterprise closed at $23.31 yesterday.

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