“Shares of Hewlett-Packard (HPQ) have deepened their losses in pre-market trading since last night’s drop following the company’s fiscal Q3 earnings report and a rather disappointing outlook: the stock is now down $5.51, or almost 19%, at $24,” Tiernan Ray reports for Barron’s. “Since opening, the drop has continued, with the stock now down $5.96, over 20%, at $23.55.”
“Following remarks by CEO Leo Apotheker on last night’s conference call, to the effect that HP is set to embark on a multi-quarter ‘transformation’ that may see a jettisoning of its PC business, the stock has received six downgrades that I can see, from RW Baird, UBS, Needham & Co., Sterne Agee, Deutsche Bank, and CLSA Asia-Pacific Markets,” Ray reports.
Kevin Hunt, Auriga Securities analyst, says that HP “is ‘massively overpaying’ for Autonomy. Management, ‘clearly suggested things are likely to get worse at HP before they get better, so we continue to recommend avoiding the HP ‘value trap,”” Ray reports.
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