Hewlett Packard Enterprise (NYSE: HPE) has confirmed that it will release its earnings on Tuesday, November 30, 2021.
What to look for
The company witnessed particular trends emerge following the pandemic, and it is looking to leverage this opportunity. The mandate for cloud everywhere, data explosion at the edge requiring secure connectivity, and the need for rapid extract valuable data to create insights and build business models are some of the trends HPE will be leveraging.
Earnings: Stockearning’s Estimated EPS is expected to improve from the last quarter’s EPS of $0.47, topping estimates of $0.42. For fiscal 2022 the company predicts EPS of between $1.96 and $2.1, excluding some items. Historical EPS Performance shows that the company has topped estimates in eleven (91%) of the last 12 quarters, only missing once (8%).
Revenue: The company is expected t to report revenue of around $7.4 billion. In the same quarter a year ago, the company had sales of $7.21 billion which will imply a positive YoY growth rate of $2.6%. The company anticipates full-year revenue of $27.83 billion. In the last quarter, the company reported revenue of $6.93 billion. The company is expecting revenue to grow at a CAGR of 2%-4% through 2024.
Stock movement: Since the last earnings release, HPE stock has lost 6.5%. HPE shares have been DOWN 12 times out of the last 24 quarters after releasing earnings. So, the historical price reaction suggests a 50% probability of the share price going DOWN once HPE releases its earnings. According to the Stockearning algorithm, the predicted first-day move is 4%, while the predicted move on the seventh day is 6%.
What analysts are saying
Goldman Sachs analyst Rod Hall downgraded the company’s rating from “Sell” to “Hold” and lowered the price target from $16 to $14. Hall said that his predictive analytics model shows a "weakening" US IT spending late this year and into early next year with declining DRAMM pricing settings that have been negative for Server Average Unit Price. The analyst added that although a significant backlog is likely to offset some of the headwinds in the short term with additional upside from the H3C exercise.
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