Shares of Hewlett Packard Enterprise (HPE) climbed higher in early trading on Tuesday, riding a wave of positive sentiment fueled by a bullish analyst upgrade and the company’s growing focus on artificial intelligence (AI).
Bank of America Securities analyst Wamsi Mohan raised the rating on HPE from Neutral to Buy, and also increased the price target from $21 to $24. Mohan’s bullish stance is driven by a combination of factors, including the company’s cost-cutting initiatives under new CFO Marie Myers, who has a proven track record of success at HP Inc.
Furthermore, Mohan expects a cyclical recovery across servers, storage, and networking sectors, which will benefit HPE. The recent acquisition of Juniper Networks is also expected to deliver significant revenue and cost synergies, further strengthening HPE’s position.
The analyst also highlights the company’s potential to capitalize on the growing demand for AI in the enterprise and government sectors, particularly through its partnership with Nvidia and the utilization of Juniper’s Mist platform, which leverages AI in the networking market.
HPE’s stock price surged 6.09% to $18.28 at the time of publication on Tuesday, reflecting investors’ enthusiasm for the company’s future prospects.
