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Hewlett-Packard Co., Market Update

9/22/2022 3:23 PM

The price of the stocks of the American giant in the field of information technology Hewlett-Packard Co. is moving in a corrective trend and is at around 26.00.

The downward trend in the company's shares continues against the background of a weak quarterly report and changes in preliminary annual forecasts. Thus, adjusted earnings per share amounted to 0.48 dollars, which is lower than the average of the first two quarters of 0.50 dollars. In Q4, the value is expected to remain in the range of 0.52–0.60 dollars, losing the consensus estimate of 0.59 dollars. The adjusted EPS indicator for the whole year may reach 2.00 dollars with a forecast of 2.02 dollars. The company estimates free cash flow in the range of 1.7–1.9B dollars, which is also lower than preliminary estimates of 1.91B dollars.

The key pressure on the shares was exerted by analysts of the financial conglomerate Morgan Stanley reducing the target price for the shares to 14.0 dollars from 15.0 dollars earlier and lowering the recommendation to "neutral".

It is worth noting that high dividends keep stock prices from falling more rapidly, since the quarterly yield is a high 3.59% per annum. The next payment is scheduled for October 7, when 0.12 dollars will be sent to shareholders.

The asset is trading within a narrow descending channel, approaching the support line. Technical indicators continue to be in a state of stable sell signal: the fast EMAs of the alligator indicator are actively expanding the oscillation range, and the histogram of the AO oscillator is in the sales zone, forming new descending bars.    

Support levels: 25.00, 22.00. | Resistance levels: 27.50, 30.50.

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