Hewlett Packard Enterprise Stock Pulls Back As Disappointing Q1, Trump Tariffs Spark Downgrade: Retail’s Unperturbed

Hewlett Packard Enterprise Company (HPE) stock bucked the broader market strength and moved lower on Wednesday following an analyst’s tempered opinion.

Investment firm Daiwa Securities downgraded the stock to ‘Neutral’ from ‘Outperform’ on Wednesday. The firm also cut the price target for the shares to $16 from $25. Analysts at the firm noted that the year started with many issues for Hewlett Packard Enterprise. 

They noted that Dell Technologies, Inc. (DELL) and  NetApp, Inc. (NTAP) also saw choppiness in January.

The analysts cited President Donald Trump’s tariffs as their biggest concern, as they believe the tariffs can push the economy into a recession and fan inflationary pressure.

As such, Daiwa reduced its fiscal year 2025 revenue estimate for Hewlett Packard Enterprise to $32.6 billion from $32.7 billion and its earnings per share (EPS) estimate to $1.80 from $2.14.

The company’s guidance issued last week calls for year-over-year (YoY) revenue growth of 7%-11% in constant currency and adjusted EPS of $1.70 to $1.90, below the previous consensus of $2.13.

Last week, the company released mixed first-quarter results and announced plans to cut jobs amid softness in the server business. 

On Stocktwits, retail sentiment toward Hewlett Packard Enterprise stock remained ‘extremely bullish’ (87/100), and message volume stayed ‘extremely high.’

HPE sentiment and message volume March 12, as of 2:14 pm ET | Source: Stocktwits

Commenting on the stock's post-earnings dip, a bullish watcher said drops like this do not happen with soft guidance when revenue growth is in double digits.

Another user said the stock could be in for a “glorious” comeback when the market reverses.

Hewlett Packard Enterprise's stock slipped nearly a percent to $15.19. The shares have registered a 28% year-to-date loss.

The TipRanks-compiled average analysts’ price target for the stock is $19.45, implying a potential upside of over 28%.

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