HP Inc. (NYSE: HPQ) reported better-than-expected quarterly results, and a Wells Fargo Securities analyst praised the company for a positive quarter.

The HP analyst: Aaron Rakers maintained an even-weight rating and $35 price target on HP stock.

The HP Thesis: HP has responded to concerns about slowing/momentums in PC demand and increased printing supply constraints that are expected to last through 2022, Rakers said.

Revenue in the Personal Systems group increased 15% year over year, ahead of consensus estimates, while the Imaging and Printing group saw revenue fall 4.2%.

“We believe a notable element of HP’s results is the company’s execution of a positive mix shift – for example, commercial PCs, high-end consumer PCs, gaming PCs and peripherals” , writes the analyst in the note.

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The company also raised its earnings per share guidance for 2022 and reiterated its free cash flow guidance, the analyst noted. Among business segments, HP expects PSG’s second-quarter revenue to fall single-digit, he added.

Favorable pricing will likely push IPG’s margins above the 16-18% range, Rakers said.

HP Price Action: When last checked, HP shares slid 0.5% to $34.23.

Latest reviews for HP

Dated Solidify action From For
February 2022 Morgan Stanley Maintains Underweight
Dec 2021 Morgan Stanley Downgrades Equal weight Underweight
November 2021 Morgan Stanley Maintains Equal weight

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