RBC Capital Raises Price Target on HP, Inc. (HPQ) Ahead of 3Q Report
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RBC Capital reiterated a Sector Perform rating on HP, Inc. (NYSE: HPQ), and raised the price target to $14.00 (from $12.00), ahead of the company's 3Q earnings report. RBC Capital is expecting HPQ to report results in-line with estimates. HPQ will report results after the market closes on August 24th.
Analyst Amit Daryanani commented, "Heading into the Jul-qtr print, we think HPQ will report in-line to slightly positive results based on improved PC demand vs. Apr-qtr and a de-risked outlook for printing. On the PC side, we note y/y trends in unit shipments improved from C1Q to C2Q and HPQ saw share gains in this segment. For printing, while data points from Canon confirm a mostly negative narrative, we think HPQ's intra-quarter Business Update Call adequately reset expectations ($225M Supplies revenue impact from channel inventory reductions for July and Oct-qtr). Other focus items this quarter include: 1) the sale of marketing optimization assets should produce a gain of $245M in Jul-qtr and $40M in Oct-qtr (communicated on the intra-quarter call) and 2) f/x: although there were several currency puts and takes this quarter, we think the impact should be modest as Pound Sterling declines are partially offset by local pricing and appreciation of other currencies. Maintain SP rating and raising target to $14 from $12 as we adjust our FTM EPS multiple from ~7-8x to ~9x to reflect an improved macro environment."
Shares of HP, Inc. closed at $14.42 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change
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