Bank of America Securities analyst Wamsi Mohan has maintained their neutral stance on HPQ stock, giving a Hold rating yesterday.
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Wamsi Mohan’s rating is based on several factors that were discussed during an investor call with HP’s CFO, Karen Parkhill. One of the primary reasons for the Hold rating is HP’s ability to manage rising memory costs through strategic measures such as leveraging existing inventory, qualifying new suppliers, and utilizing pricing strategies. Despite these efforts, the anticipated increase in NAND/DRAM costs is expected to have a notable impact on HP’s earnings per share.
Additionally, HP’s new restructuring initiative, which aims to achieve significant cost savings by utilizing AI, is another factor contributing to the Hold rating. While this initiative is expected to drive productivity and offset some cost pressures, the overall growth in earnings per share is projected to be driven primarily by share buybacks. The combination of these factors, alongside HP’s commitment to returning free cash flow to shareholders, supports the decision to maintain a Neutral stance with a price objective of $26.
In another report released yesterday, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $26.00 price target.