Analyst Note| Mark Cash |
No-moat HP reported revenue and non-GAAP earnings per share above CapIQ consensus estimates, as the company continues to weather the economic headwinds brought on by the global pandemic. HP’s second consecutive estimates beat was primarily driven by strong demand in the personal systems segment as remote working continues to be commonplace. Like the July quarter, the company’s commercial business suffered this quarter as well, with low demand for supplies and commercial printing in a pandemic-stricken global economy where offices remain empty. With that in mind, we maintain our fair value estimate of $20 per share. Shares rose 6% after hours, and we recommend waiting for a wider margin of safety.