OK, so it's a one-cent beat, but still.
), the computer manufacturing giant, posted $1.01 per share in
its fiscal Q4 earnings after the bell Tuesday, on revenues of
$29.1 billion. This topped the Zacks consensus estimates of $1.00
and $28.0 billion in the quarter.
This is clearly welcome news to after-market traders. After
selling off a few pennies in regular Tuesday trading
Hewlett-Packard shares are up roughly 8% as of now in the
after-market. Not too shabby considering HPQ is up nearly 77%
year-to-date even before this bull run. Also consider that both
top and bottom lines are down year over year -- 13% on earnings
and 3% on sales.
H-P is still going through a multi-year process of righting the
ship, and CEO Meg Whitman cited "improved execution" and "strong
cost management" to post the company's third positive earnings
surprise in the past four quarters. Whitman mentioned also the
recovery at H-P remains "on track."
Also consider this company is trading at a 12-month-trailing
multiple under 5x earnings currently; seemingly, this is a good
value play for investors encouraged by the positive surprises.
But with Enterprise Services and Software sales each down 9% year
over year, and Financial Services down another 6%, plenty of
questions remain as to the long-term trajectory of H-P. These are
generally the same issues currently facing
), in that the dwindling PC market must be dealt with by growing
elsewhere. But these companies are behemoths; they're aircraft
carriers -- turning them around is no walk in the park.
Enterprise spending will be a major factor going forward, of
course, but the biggest challenge for H-P will be its ability to
gain a foothold in new technology usages. Currently, Microsoft is
doing more in cloud computing, for instance.
Analysts had been mixed in Q4 and fiscal 2013 estimates. H-P
retains a Zacks Rank #3 (Hold) as well as a longer-term Neutral
HEWLETT PACKARD (HPQ): Free Stock Analysis
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