Hewlett Packard (HPE) Stock Forecast & Price Target

Hewlett Packard is supported by accelerating Cloud/AI demand, with agentic and inference workloads driving higher server orders, strong backlog, and revenue growth that outpaced expectations. Its Networking business is becoming a much larger, underappreciated earnings engine, with FY27E growth now seen at high-teens to low-20%, nearly 40% to 45% of operating income, and $800 million in annual run-rate cost synergies targeted by the end of FY28E. Combined with margin expansion, 15% to 20% EPS growth over the next several years, and rising free cash flow with at least 75% returned to shareholders starting next quarter, the company’s improving fundamentals justify a positive outlook.

Hewlett Packard is facing a fundamentally weaker setup because execution risk around the Juniper merger, rising memory costs, and broader inflationary pressures could compress margins while competitive pressure and a macro downturn weigh on demand. Although the company highlighted upside in traditional servers and AI systems, better gross profit margin, and stronger large-deal momentum, its core campus business remains pressured and order growth is slowing, suggesting revenue strength may be peaking. The business also appears less exposed to the end-markets currently showing strength, while supply constraints have not translated into a clear advantage versus peers, reinforcing a cautious outlook.