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Hewlett Packard Enterprise should be due for more moves to the upside on the heels of its upcoming quarterly results, Morgan Stanley said Thursday. The firm upgraded the tech services company to overweight from equal weight and increased its price target by $6 to $28, implying 33% upside from Wednesday’s close. This comes as shares have surged about 20% in the past three months, supported by a rise in shares following the closure of the company’s acquisition of Juniper Networks in early July. “Our thesis is straight-forward – with the closure of JNPR, we see 18% upside to FY26 Consensus EPS, with EPS growing to $2.70-3.00 in FY27, and believe that as the market comes to better understand nearly half of HPE’s business is networking, inclusive of more AI exposure (JNPR in xAI cluster), HPE’s multiple will re-rate above the current 8x multiple,” analyst Erik Woodring wrote in a Thursday note. HPE 3M mountain HPE, 3-month Looking ahead, shares could see support in the wake of HPE’s third-quarter results after the bell on Sept. 3, the analyst said. He sees overall hardware spending growth decelerating in the second half of the year, leading him to favor names like HPE that have exposure to networking and artificial intelligence. “We believe the July quarter setup is most favorable for OWrated HPE, as the stock remains the cheapest of the group (at 8.5x times our FY26 EPS), AI expectations are low, and management should guide October quarter results decently ahead of Consensus, which is yet to incorporate the JNPR acquisition,” he wrote. Woodring also believes that HPE’s analyst day in October is the “most important upcoming catalyst,” with the expectation that the company will provide longer-term forecasts that could “help the market more clearly appreciate HPE’s future earnings/cash flow power.” Wall Street is split on the name, however. While Woodring is in the camp of analysts with a bullish view, with 10 out of 20 having a strong buy or buy rating, the remaining 10 have stepped to the sidelines with a hold rating, per LSEG. Shares jumped about 3% in premarket trading on Thursday following the upgrade.
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