Analyst Note| Mark Cash |
No-moat HP reported top- and bottom-line numbers above our expectations as work from home and school enablement tools remain highly sought after. Demand for HP’s notebook computers and home printers soared as widespread shelter-in-place orders remain due to COVID-19. While we still believe the computer and printing markets face long-term secular headwinds, the importance of connectivity and business enablement has buoyed our outlook. We are raising our fair value estimate to $23 per share from $20. With shares currently trading around $28 per share, we recommend investors wait for a wider margin of safety.