STOXPO
  • Latest News
  • Technology
    • Software
    • Semiconductors
  • Healthcare
    • Biotechnology
    • Pharmaceuticals
  • Crypto
    • Altcoins
    • Bitcoin
    • Ethereum
  • Companies
    • Micro-Cap
    • Small-Cap
    • Mid-Cap
    • Large-Cap
    • Mega-Cap
  • Q&A’s
  • Contributions
No Result
View All Result
  • Latest News
  • Technology
    • Software
    • Semiconductors
  • Healthcare
    • Biotechnology
    • Pharmaceuticals
  • Crypto
    • Altcoins
    • Bitcoin
    • Ethereum
  • Companies
    • Micro-Cap
    • Small-Cap
    • Mid-Cap
    • Large-Cap
    • Mega-Cap
  • Q&A’s
  • Contributions
No Result
View All Result
STOXPO
No Result
View All Result
Home Technology Computer Hardware
code-2

Hewlett Packard Enterprise Upgraded by Bank of America Amid Strategic Shift and Juniper Networks Acquisition

byLiliana Vida
September 17, 2024
in Computer Hardware, Large-Cap, Technology
Reading Time: 4 mins read
Share on TwitterShare on LinkedIn

BofA Raises Price Target as HPE Leverages Networking Growth and AI Opportunities

Hewlett Packard Enterprise Co. (NYSE: HPE) received a significant endorsement from Bank of America (BofA) analysts this week, as they upgraded the stock from a Neutral rating to Buy and raised the price target to $24 from $21. The move, which caused HPE shares to rise about 4% in Tuesday’s pre-market trading, signals growing confidence in the company’s strategic evolution, particularly as it prepares to close a major acquisition deal with Juniper Networks Inc. (NYSE: JNPR).

Acquisition of Juniper Networks to Propel HPE Forward

A central focus of BofA’s optimism revolves around HPE’s forthcoming acquisition of Juniper Networks, valued at approximately $14 billion in cash. This acquisition is expected to shift HPE’s focus away from its compute solutions, which have been a core aspect of the business, and toward the high-margin networking segment. Antonio Neri, HPE’s CEO, has been steering the company toward reducing its dependency on traditional hardware and instead capitalizing on new technologies that offer greater growth potential and profitability.

While the networking market remains challenging due to competitive pressures and macroeconomic headwinds, analysts at BofA expect HPE to emerge as a stronger player in this space. The acquisition is anticipated to generate more than $450 million in cost synergies, with 70% of those savings expected to be realized by the end of 2026. This strategic move is poised to not only diversify HPE’s portfolio but also drive up earnings, with a projected significant increase in consensus earnings per share (EPS) over the next few years.

“We expect additional cost takeouts at core HPE of at least 100 basis points (bps) incrementally, which is also likely conservative,” BofA analysts stated in their note on Tuesday, indicating that the company’s cost-cutting measures are set to enhance its profitability even further.

Strong Financials Bolster the Upgrade

Beyond the acquisition, HPE’s Q3 financial results provide further grounds for optimism. The company reported $1.3 billion in revenue from its AI server segment, highlighting a robust demand for AI-driven solutions. Furthermore, HPE noted a backlog of $3.4 billion, indicating strong future growth prospects. The company’s focus on improving operating margins in its server business has already borne fruit, with notable margin expansion on a quarter-over-quarter basis.

The partnership between HPE and NVIDIA (NASDAQ: NVDA) is another critical element in the company’s growth strategy. Leveraging NVIDIA’s leadership in AI computing, HPE is expected to capitalize on AI-related opportunities in both the enterprise and public sectors. Moreover, HPE’s expertise in liquid cooling through its CRAY systems and its growing presence in supercomputing further position the company as a leading player in AI adoption.

“Thanks to decades of expertise in liquid cooling (CRAY systems) and increased adoption of supercomputing, HPE will be able to command a key position in AI adoption at the enterprise and sovereign levels,” analysts noted, underscoring the company’s technological leadership in this space.

Valuation and Risks

Despite the positive outlook, HPE’s current stock valuation suggests it may still be undervalued. The stock is trading at approximately 8x the estimated 2025 consensus EPS, which is at the lower end of its historical trading range of 6 to 13 times earnings. This lower valuation, coupled with the strong growth potential associated with the Juniper acquisition and HPE’s AI initiatives, makes the stock attractive to investors.

BofA’s price target of $24 is based on a 10x multiple of the projected 2026 pro-forma EPS of $2.40, indicating a solid upside from the current price. However, the analysts also caution that risks remain. The acquisition of Juniper Networks will increase HPE’s leverage, and any potential challenges in integrating Juniper’s operations could pose execution risks. Additionally, in a broader economic downturn, HPE’s exposure to cyclical markets could exacerbate these risks.

Nevertheless, BofA believes that the potential rewards outweigh these risks. The firm’s confidence in HPE’s ability to realize cost synergies, execute on its strategic shift, and strengthen its presence in high-growth markets like AI and networking are key factors behind the Buy rating and the elevated price target.

Hewlett Packard Enterprise is undergoing a pivotal transformation, and Bank of America’s upgrade reflects growing confidence in the company’s strategic direction. By acquiring Juniper Networks and deepening its AI partnerships with NVIDIA, HPE is positioning itself for long-term growth in high-margin areas like networking and AI-driven enterprise solutions. While challenges remain, particularly in integrating Juniper and navigating a potentially volatile economic environment, HPE appears well-prepared to emerge as a leader in the next phase of enterprise technology.

You might like this article:BCYC’s Promising Oncology Pipeline: Updates Highlight Strong Efficacy and Tolerability in Key Cancer Trials

Tags: analystMoversNewsStock Market
Previous Post

BCYC’s Promising Oncology Pipeline: Updates Highlight Strong Efficacy and Tolerability in Key Cancer Trials

Next Post

Intuitive Machines Secures $4.82 Billion NASA Contract to Lead Lunar Communication and Navigation

Related Posts

trading-chart-2

Qualcomm Posts Strong Q3 Results, Fueled by Automotive and IoT Growth

byLuca Blaumann
July 30, 2025
0

Record Automotive Revenue and $3.8 Billion Returned to Shareholders Highlight Robust Quarter Qualcomm (QCOM) delivered solid third-quarter fiscal 2025 results,...

Palo Alto Networks Eyes $20B Deal for CyberArk

byLuca Blaumann
July 29, 2025
0

Potential Acquisition Could Reshape the Cybersecurity Landscape Palo Alto Networks (PANW) is reportedly in advanced discussions to acquire CyberArk Software...

trading-chart

AMD and Amazon: Two Titans Poised for Explosive Growth

byLuca Blaumann
July 28, 2025
0

Why Investors Are Doubling Down on These Market Leaders in AI and Cloud Computing Advanced Micro Devices (AMD) and Amazon...

Next Post

Intuitive Machines Secures $4.82 Billion NASA Contract to Lead Lunar Communication and Navigation

Latest News

Qualcomm Posts Strong Q3 Results, Fueled by Automotive and IoT Growth

Palo Alto Networks Eyes $20B Deal for CyberArk

AMD and Amazon: Two Titans Poised for Explosive Growth

FCC Approves $8B Paramount-Skydance Merger Amid Political Controversy

FAA Keeps Boeing 737 MAX Production Cap in Place Amid Ongoing Oversight

Based on Your Interest

Large-Cap

Intel Beats on Revenue, Misses on Earnings; Cuts Workforce by 15%

July 24, 2025
trading-chart-2
Brokerages

Accelerant Soars in NYSE Debut, Valued at $6.4 Billion

July 24, 2025
investing
Distributor

GoPro and Krispy Kreme Surge as Meme Stock Frenzy Reignites

July 23, 2025

Recommended

Electrical Equipment

GE Vernova Soars to Record High on Raised Cash Flow Outlook

July 23, 2025
Auto Manufacturers

Earnings Season Surprises: Coca-Cola Delivers, GM Struggles Under Tariff Pressure

July 22, 2025
Entertainment

Trump Media Stock Rises After $2 Billion Bitcoin Bet

July 21, 2025
Biotechnology

ProMIS Neurosciences Soars 160% After FDA Fast Track Designation for Alzheimer’s Drug

July 21, 2025
Bitcoin

Michael Saylor’s Strategy Now Holds Over 3% of All Bitcoin Ever Minted

July 21, 2025
Stoxpo

Follow us on social media:

Highlights

  • Qualcomm Posts Strong Q3 Results, Fueled by Automotive and IoT Growth
  • Palo Alto Networks Eyes $20B Deal for CyberArk
  • AMD and Amazon: Two Titans Poised for Explosive Growth
  • FCC Approves $8B Paramount-Skydance Merger Amid Political Controversy
  • FAA Keeps Boeing 737 MAX Production Cap in Place Amid Ongoing Oversight

Category

  • Blog
  • Communication Services
    • Entertainment
    • Internet
    • Telecommunications
  • Companies
    • Large-Cap
    • Mega-Cap
    • Micro-Cap
    • Mid-Cap
    • Small-Cap
  • Consumer Cyclical
    • Auto Manufacturers
    • Casinos & Gambling
    • Ground Transportation
    • Hospitality
      • Casinp
      • Resorts & Lodging
      • Restaurants
      • Travel
        • Airlines
    • Retail
    • Textiles, Apparel & Luxury Goods
  • Consumer Defensive
    • Beverages
    • Discount Stores
    • Distributor
    • Ecommerece
    • Electrical Equipment
    • Foods
    • Household & Personal Products
    • Leisure Products
    • Tobacco
  • Contributions
  • Crypto
    • Altcoins
    • Bitcoin
    • Ethereum
  • Economy
  • Energy
    • Electric
    • Oil & Gas
    • Renewables
  • Financial Services
    • Asset Management
    • Banks
    • Brokerages
    • Credit Services
    • Insurance
  • Healthcare
    • Biotechnology
    • Medical Devices
    • Pharmaceuticals
  • Industrials
    • Aerospace & Defense
    • Construction
    • Industrial Machinery
  • Materials
    • Building Materials
    • Chemicals
    • Gold
    • Mining
    • Silver
    • Steel
  • Q&A's
  • Real Estate
  • Technology
    • Artificial Intelligence
    • Computer Hardware
    • Consumer Electronics
    • Cybersecurity
    • IT Services
    • Semiconductors
    • Software
  • Utilities

Latest News

trading-chart-2

Qualcomm Posts Strong Q3 Results, Fueled by Automotive and IoT Growth

July 30, 2025

Palo Alto Networks Eyes $20B Deal for CyberArk

July 29, 2025
trading-chart

AMD and Amazon: Two Titans Poised for Explosive Growth

July 28, 2025
  • About
  • Privacy Policy
  • Contact

© 2024 All Rights Reserved: STOXPO.

No Result
View All Result
  • Latest News
  • Healthcare
    • Biotechnology
    • Pharmaceuticals
  • Technology
    • Software
    • Semiconductors
  • Crypto
    • Bitcoin
    • Ethereum
    • Altcoins
  • Companies
    • Micro-Cap
    • Small-Cap
    • Mid-Cap
    • Large-Cap
    • Mega-Cap
  • Q&A’s
  • Contributions

© 2024 All Rights Reserved: STOXPO.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Read More

In case of sale of your personal information, you may opt out by using the link Do Not Sell My Personal Information

Accept Cookie Settings
Cookies are small text files that can be used by websites to make a user's experience more efficient. The law states that we can store cookies on your device if they are strictly necessary for the operation of this site. For all other types of cookies we need your permission. This site uses different types of cookies. Some cookies are placed by third party services that appear on our pages.
  • Always Active
    Necessary
    Necessary cookies help make a website usable by enabling basic functions like page navigation and access to secure areas of the website. The website cannot function properly without these cookies.
  • Marketing
    Marketing cookies are used to track visitors across websites. The intention is to display ads that are relevant and engaging for the individual user and thereby more valuable for publishers and third party advertisers.
  • Analytics
    Analytics cookies help website owners to understand how visitors interact with websites by collecting and reporting information anonymously.
  • Preferences
    Preference cookies enable a website to remember information that changes the way the website behaves or looks, like your preferred language or the region that you are in.
  • Unclassified
    Unclassified cookies are cookies that we are in the process of classifying, together with the providers of individual cookies.
Cookie Settings

Do you really wish to opt-out?