Hewlett Packard Enterprise, the Technology sector company, was revisited by a Wall Street analyst today. Analyst Erik Woodring from Morgan Stanley maintained a Buy rating on the stock and has a $28.00 price target.
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Erik Woodring has given his Buy rating due to a combination of factors that suggest Hewlett Packard Enterprise (HPE) has strong potential for growth and value appreciation. Despite some confusion in the company’s guidance and a below-Street FY26 EPS forecast, Woodring believes that the stock is undervalued at a 10x P/E ratio and that there is conservatism built into the current model. The expectation of EPS growth of over 50% in the next three years, with EPS potentially reaching $3 by FY28, supports this positive outlook.
Furthermore, Woodring highlights that HPE’s high-margin networking segment is expected to increase its contribution to operating income, reaching 60% from over 50% today. The long-term guidance also suggests margin expansion through a positive mix shift, and an improvement in free cash flow conversion from 65% to 80% by FY28. These factors, combined with the company’s potential for consistent execution and credibility-building, underpin the Buy rating, despite the mixed FY26 guidance and challenges in cost synergies from the Juniper acquisition.
Woodring covers the Technology sector, focusing on stocks such as Apple, Dell Technologies, and Western Digital. According to TipRanks, Woodring has an average return of 4.7% and a 58.80% success rate on recommended stocks.
In another report released today, Barclays also maintained a Buy rating on the stock with a $27.00 price target.