Hewlett Packard Enterprise (HPE) AI Stock Analysis

• Market Cap: $28.00B
• Dividend Yield: 2.44%
• Average Volume (3M): 19.10M
• Price to Earnings (P/E): 22.0
• Beta (1Y): 1.58
• Revenue Growth: 11.63%
• EPS Growth: -24.41%
• Country: US
• Employees: 61,000
• Sector: Technology
• Sector Strength: 87
• Industry: Communication Equipment
• EPS (TTM): 0.38
• Shares Outstanding: 1,312,215,600
• 10 Day Avg. Volume: 24,279,217
• 30 Day Avg. Volume: 19,096,331
• PEG Ratio: -0.56
• Price to Book (P/B): 1.30
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 19.46
• Enterprise Value/Market Cap: 1.15
• Enterprise Value/Revenue: 0.26
• Enterprise Value/Gross Profit: 4.40
• Enterprise Value/Ebitda: 1.84
• 1Y Price Target: $22.13
• Price Target Upside: 3.70% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 69 Neutral
• Price Target: $22.50 ▲(5.44%Upside)

Hewlett Packard Enterprise's overall stock score reflects its robust financial performance, driven by consistent revenue growth and profitability. Positive earnings call results highlight strong AI and hybrid cloud growth, supporting future prospects. However, technical indicators suggest potential overbought conditions, and valuation metrics indicate modest attractiveness. Challenges in the server segment and cash flow management are notable risks, but strategic initiatives are in place to address these issues.

Positive Factors

Financial Performance

Hewlett Packard Enterprise reported strong F2Q results, beating on both top-line and bottom-line metrics.

Legal Settlement

Settlement with DoJ removes overhang on HPE stock, making set up more positive.

Strategic Partnerships

HPE's expanded partnership with NVIDIA marks a meaningful step forward in their AI monetization strategy, enhancing their relevance in GPU-dense workloads.

Negative Factors

Future Revenue Guidance

HPE’s strong F3Q revenue/EPS guide implies a weaker than expected F4Q.

Hewlett Packard Enterprise Business Overview & Revenue Model

Company Description

Hewlett Packard Enterprise Company provides solutions that allow customers to capture, analyze, and act upon data seamlessly in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. The company offers general purpose servers for multi-workload computing and workload-optimized servers; HPE ProLiant rack and tower servers; HPE BladeSystem and HPE Synergy; and solutions for secondary workloads and traditional tape, storage networking, and disk products, such as HPE Modular Storage Arrays and HPE XP. It also offers HPE Apollo and Cray products; and HPE Superdome Flex, HPE Nonstop, HPE Integrity, and HPE Edgeline products. In addition, the company provides HPE Aruba product portfolio that includes wired and wireless local area network hardware products, such as Wi-Fi access points, switches, routers, and sensors; HPE Aruba software and services comprising cloud-based management, network management, network access control, analytics and assurance, and location; and professional and support services, as well as as-a-service and consumption models for the intelligent edge portfolio of products. Further, it offers various leasing, financing, IT consumption, and utility programs and asset management services for customers to facilitate technology deployment models and the acquisition of complete IT solutions, including hardware, software, and services from Hewlett Packard Enterprise and others. Additionally, the company invests in communications and media solutions. It has a partnership with Striim, Inc. to offer high performance and mission-critical solutions with real-time analytics. It serves commercial and large enterprise groups, such as business and public sector enterprises; and through various partners comprising resellers, distribution partners, original equipment manufacturers, independent software vendors, systems integrators, and advisory firms. Hewlett Packard Enterprise Company was founded in 1939 and is headquartered in Houston, Texas.

How the Company Makes Money

Hewlett Packard Enterprise makes money through a diversified revenue model that includes the sale of hardware, software, and services. A significant portion of its revenue comes from its Hybrid IT segment, which includes servers, storage, and data center networking solutions. HPE also generates income through its Intelligent Edge segment, offering edge computing and IoT solutions, and its Financial Services segment, which provides leasing and financial management services. Additionally, HPE capitalizes on strategic partnerships with other technology firms and service providers, enhancing its product offerings and expanding its market reach. The company also offers subscription-based services and cloud solutions, creating recurring revenue streams that contribute to its financial performance.

Hewlett Packard Enterprise Financial Statement Overview

Summary

Hewlett Packard Enterprise demonstrates solid financial performance with consistent revenue growth and profitability. The balance sheet reflects a stable financial position with manageable leverage and good equity returns. Cash flow generation is strong, supporting operational needs and growth initiatives. However, monitoring cost management and enhancing cash flow efficiency could further strengthen its financial standing.

Income Statement

Hewlett Packard Enterprise shows a steady revenue growth with a 3.58% increase in TTM compared to the previous year. The Gross Profit Margin stands at 48.65%, indicating effective cost management. The Net Profit Margin of 8.86% is healthy, reflecting strong profitability. EBIT and EBITDA margins of 6.90% and 13.59% respectively, reveal solid operational efficiency. However, the slight decline in EBIT margin from 7.27% in the previous year suggests potential cost pressures.

Balance Sheet

The company maintains a moderate Debt-to-Equity Ratio of 0.71, showing a balanced leverage. The Return on Equity (ROE) is robust at 10.96%, demonstrating effective use of shareholders' equity to generate profits. The Equity Ratio of 35.86% indicates a stable financial structure, though slightly lower compared to industry peers, suggesting room for improvement in asset financing.

Cash Flow

Hewlett Packard Enterprise's Free Cash Flow grew by 10.24% in the TTM, highlighting strong cash generation capabilities. The Operating Cash Flow to Net Income Ratio of 1.41 reflects efficient cash conversion from earnings. The Free Cash Flow to Net Income Ratio of 0.79 indicates a healthy cash flow relative to profits, though there is room to enhance cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	31.65B	30.13B	29.14B	28.50B	27.78B	26.98B
Gross Profit	7.34B	9.84B	10.24B	9.51B	9.38B	8.47B
EBITDA	2.67B	5.02B	5.06B	4.78B	4.85B	4.26B
Net Income	1.43B	2.58B	2.02B	868.00M	3.43B	-322.00M
Balance Sheet
Total Assets	67.85B	71.26B	57.15B	57.12B	57.70B	54.02B
Cash, Cash Equivalents and Short-Term Investments	11.67B	14.85B	4.27B	4.16B	4.00B	4.23B
Total Debt	17.53B	18.25B	13.52B	12.46B	13.45B	15.94B
Total Liabilities	43.99B	46.38B	35.91B	37.21B	37.68B	37.92B
Stockholders Equity	23.87B	24.82B	21.18B	19.86B	19.97B	16.05B
Cash Flow
Free Cash Flow	1.18B	1.97B	1.60B	1.47B	3.37B	-143.00M
Operating Cash Flow	2.33B	4.34B	4.43B	4.59B	5.87B	2.24B
Investing Cash Flow	42.00M	-53.00M	-3.28B	-2.09B	-2.80B	-2.58B
Financing Cash Flow	6.47B	6.28B	-1.36B	-1.80B	-3.36B	883.00M

Hewlett Packard Enterprise Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 21.34
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HPE, the sentiment is Positive. The current price of 21.34 is above the 20-day moving average (MA) of 18.60, above the 50-day MA of 17.64, and above the 200-day MA of 19.01, indicating a bullish trend. The MACD of 0.87 indicates Negative momentum. The RSI at 80.96 is Negative, neither overbought nor oversold. The STOCH value of 92.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HPE.

Hewlett Packard Enterprise Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UI	74 Outperform	$25.65B	46.73	237.68%	0.57%	21.43%	56.87%
CSCO	72 Outperform	$274.71B	28.43	21.36%	2.36%	0.47%	-17.77%
JNPR	71 Outperform	$13.42B	38.18	7.58%	2.20%	-2.56%	52.05%
HPE	69 Neutral	$28.00B	22.05	6.39%	2.44%	11.63%	-24.41%
ERIC	68 Neutral	$28.79B	182.09	1.67%	0.31%	-2.08%	―
NOK	65 Neutral	$27.91B	34.60	5.70%	3.98%	-9.96%	-6.83%
Sector *	63 Neutral	$34.07B	6.13	-11.73%	1.80%	5.33%	-18.31%

Hewlett Packard Enterprise Corporate Events

Hewlett Packard Enterprise Completes Merger with Juniper

On July 2, 2025, Hewlett Packard Enterprise announced the completion of its merger with Juniper, making Juniper a wholly owned subsidiary. The merger, valued at approximately $13.4 billion, was funded through a combination of cash, commercial paper issuances, and term loan credit facilities. The merger faced legal challenges when the U.S. Department of Justice sought to block it, but a settlement was reached requiring HPE to divest its Instant On business and conduct an auction for non-exclusive licensing of Juniper’s Mist AIOps source code.

The most recent analyst rating on (HPE) stock is a Hold with a $20.00 price target. To see the full list of analyst forecasts on Hewlett Packard Enterprise stock, see the HPE Stock Forecast page.

Hewlett Packard Enterprise Reports Q2 Revenue Growth

Hewlett Packard Enterprise announced its financial results for the second quarter of fiscal year 2025, reporting a 6% increase in revenue to $7.6 billion compared to the previous year. Despite a solid performance in revenue growth across its product segments, the company faced challenges with a GAAP net loss per share of $(0.82) due to a non-cash impairment of legacy goodwill. HPE continues to focus on innovation and operational efficiency to enhance shareholder value, with an estimated revenue growth of 7% to 9% for fiscal 2025.

The most recent analyst rating on (HPE) stock is a Hold with a $20.00 price target. To see the full list of analyst forecasts on Hewlett Packard Enterprise stock, see the HPE Stock Forecast page.

Hewlett Packard Enterprise Declares Dividend for Preferred Stock

On April 30, 2025, Hewlett Packard Enterprise‘s Board of Directors approved a cash dividend of $0.953125 per share for its Series C Mandatory Convertible Preferred Stock, payable on June 1, 2025. This decision reflects the company’s financial strategy and commitment to returning value to shareholders, with implications for investor confidence and market positioning.