HSBC analyst Abhishek Shukla upgraded the rating on HP to a Buy today, setting a price target of $30.00.
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Abhishek Shukla has given his Buy rating due to a combination of factors influencing HP’s market performance. One of the primary reasons is the unexpected increase in PC unit shipments, which have outperformed previous forecasts. This growth is further supported by the upcoming end of support for Windows 10, which is likely to drive demand for new PCs as many existing devices do not meet the requirements for Windows 11. Additionally, the outlook for printer volumes is more optimistic than anticipated, as HP and other manufacturers have adjusted prices, potentially leading to improved sales dynamics.
Another significant factor is the reduced impact of US-China tariff tensions on HP, as the company has minimized its reliance on imports from China. This strategic move, combined with price adjustments to account for tariffs and increased manufacturing costs, is expected to enhance earnings momentum in the coming fiscal year. Furthermore, HP’s current valuation appears attractive, with shares trading below historical averages, suggesting potential for price appreciation. The target price has been raised to USD30.00, indicating a 17.4% upside, which supports the upgrade to a Buy rating.