Wednesday, January 5, 2011

Hewlett Packard: On the Rise

Since the acquisition of Hewlett Packard in the portfolio the company has had many newsworthy actions that support the purchase of the stock. It has has been on the rise and closed today at $44.17 (January 5th 2011).

The main risks going into this new fiscal year was whether or not Hewlett Packard was going to maintain its strong sales ability in renewing and obtaining new contracts. Since the beginning of the fiscal year they have received contracts summing in the multi-billions of dollars. A note-able contract was with NASA beating out Lockhead Martin, the HP Enterprise Services won a $2.5 billion contract to manage, secure, and maintain its IT infrastructure across all of the agency’s research and flight centers. The program is called Agency Consolidated End-User Services, or ACES, and stretches out over 10 years. Currently Hewlett Packard ranks No. 12 on Washington Technology’s 2010 Top 100 list of the largest federal government contractors.

RBC Capital analyst Amit Daryanani writes in a report that came out January 3 that 2011 he assigns HPQ an Outperform rating and a $57 price target.

Hewlett-Packard on tuesday January 4th 2010 announced a netbook with some cutting-edge mobile broadband and graphics technologies that could make it the most powerful netbook yet. The lightweight Pavilion DM1 netbook comes with an 11.6-inch screen, and runs on Advanced Micro Devices' new Fusion processor, which bundles a graphics chip and CPU into a single piece of silicon. The DM1 runs for a maximum of 10.5 hours with solid-state drive storage, and 9.5 hours on hard drive storage. This Netbook will be have the capability to be on wireless LTE (long-term evolution) mobile broadband networks, which offer faster data transfers than current 3G networks.(Rumored with Verizon but could possible be with another network.)

Chief Marketing Officer Michael Mendenhall resigned and is going to be replaced by SAP V.P. Bill Wohl. There is no definite reason for mendhalls leaving as of yet but this will sure stir up some controversy.

HP has invited the press to a WebOS announcement which will not be at CES but on Feb. 9. "The wording of the invite also hints there may be more than one device presented."

-Jonathan Wiener

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