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Technology Stocks : Hewlett-Packard (HPQ)
HPQ 22.12-0.7%Jan 2 9:30 AM EST
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To: Oeconomicus who wrote (2619)2/26/2003 12:44:16 PM
From: Elroy   of 4345
 
I think it's an over reaction (stock down 13% now) for a 3% revenue miss. One problem is most every analyst came out with their HPQ previews last week saying that these are my numbers and I wouldn't be surprised to see an extra $100 million on the top line and an extra 2 cents EPS over my numbers. Thus, investors were expecting them to beat both revenues and EPS. Since most of the revenue miss was in PCs and enterprise hardware (which both don't make any money) it don't really matter to me. With HPQ now at 13x $1.20 EPS (just annualize the current quarter) it seems pretty attractive to me.

Good - Gross margins up, operating margins up, printing/imaging still growing and dominating the world, more cost reductions still to come once those hard working Europeans get fired with their mandatory government regulated one year notice, analysts turning bearish (goodbye Conigliaro, and don't come back) and a nice valuation.

Bad - Half the business is still crappy hardware and sales in that business area were weaker than HPQ's November guidance, uhmm, anything else that was particularly bad? Can't really think of much except they sold a few less money losing servers, work stations and PCs than they could have. Oh well!

Elroy
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