Technology major HP Inc. (NYSE: HPQ) recently announced that it has acquired a packaging development company, Choose Packaging. The financial terms of the deal have been kept under wraps.
Following the news, shares of the company rose 1.9% on Wednesday. The stock, however, pared its gains slightly to close at $38 in the extended trading session.
The buyout is in line with HP’s strategy to gain a strong foothold in the sustainable packaging market, as the company aims at disrupting this market with fiber-based, 100% plastic-free packaging. In this regard, Choose’s technology provides an alternative to plastic bottles and can hold a wide variety of liquid products.
With the addition of Choose, HP can now focus on improving its technology to cater to the needs of this market.
The Chief Strategy & Incubation Officer at HP, Savi Baveja, said, “This acquisition is a great example of how we continue to strengthen our capabilities in attractive verticals like sustainable packaging while also driving progress against HP’s broader sustainability goals. Choose has built a truly differentiated technology and we are excited to welcome this talented team to the HP family.”
Recently, Evercore ISI analyst Amit Daryanani reiterated a Buy rating on the stock with a price target of $42, which implies upside potential of 10.1% from current levels.
Consensus among analysts is a Hold based on 1 Buy, 5 Holds and 1 Sell. The average HP stock prediction of $36.43 implies downside potential of 4.5% from current levels. Shares have gained 51.3% over the past year.
TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on HP. Further, 3.3% of portfolios tracked by TipRanks increased their exposure to HP stock over the past 30 days.
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