HP (HPQ) Is Seeing an Awfully Strong Post-Autonomy Bounce

November 26, 2012 1:50 PM EST
Don't look now but since collapsing 12 percent last Tuesday on news of possible accounting fraud at Autonomy, shares of HP (NYSE: HPQ) are up every day since including today's 3.3 percent move higher.

With shares trading at $13.30 before the disclosure, they still have a little way to go to make up for the losses - currently at $12.86 - but the move is notable.

It is unclear if this is just short covering or real bottom-fishing in the name. Wall Street analysts for their part are recommending clients still stay away from the stock saying the worst is not over, and short seller Jim Chanos, who made a prescient call on the stock, said he is still short calling it a "value trap."

So what gives? It is possible that activist investors are stepping up efforts with the stock trading at just 3.6x the high end of next year's $3.60 non-GAAP EPS target. Notably Ralph Whitworth of Relational Investors fame sits on the company board. At last check he owns 34,534,517 shares, or 1.76%. He could be buying hand-over-fist at these levels.

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