Enterprise information technology company Hewlett Packard Enterprise (HPE) recently announced that it has bagged a $2 billion contract from the National Security Agency (NSA).
Following the news, shares of the company declined marginally on Wednesday. It pared its losses slightly to close at $15.35 in extended trade.
As per the contract, the company will deliver HPE’s high-performance computing (HPC) technology as a service through the HPE GreenLake platform over a period of 10 years. The new service, which involves the combination of the company’s Apollo systems and ProLiant servers, will allow NSA to harness its data more efficiently. The service will go into use starting in 2022.
The Senior Vice-President and General Manager of HPC and Mission Critical Solutions (MCS) at Hewlett Packard, Justin Hotard, said, “By using the HPE GreenLake platform, which delivers secure on-premises solutions as a service, the National Security Agency (NSA) is gaining industry-leading HPC solutions to tackle a range of complex data needs, but with a flexible, as a service experience.” (See Hewlett Packard Enterprise stock chart on TipRanks)
Last month, Evercore ISI analyst Amit Daryanani upgraded the stock to a Buy with a price target of $20, which implies upside potential of 30.4% from current levels.
The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 5 Buys, 5 Holds and 1 Sell. The average Hewlett Packard price target of $16.90 implies that the stock has upside potential of 10.2% from current levels.
Hewlett Packard scores a 9 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained about 56.1% over the past year.
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