NEW YORK, August 10, 2026, 16:18 EDT — Hewlett Packard Enterprise (HPE) stock rose after Morgan Stanley lifted its rating, setting a price target of $71 that suggests shares could rise 30%.
- Shares of Hewlett Packard Enterprise climbed 2.73% to finish at $54.67 following an upgrade from Morgan Stanley.
- The bank has set a target price of $71, indicating a potential 29.9% increase from Monday’s closing level.
- HPE is valued at roughly 13.6 times the consensus earnings estimate for its upcoming fiscal year, representing a 32% discount compared to the S&P 500 benchmark, which trades at 20 times.
- Revenue for the fiscal second quarter climbed 40%, with networking sales up by 148.2%.
Shares of Hewlett Packard Enterprise NYSE:HPE climbed 2.73% on Monday after Morgan Stanley raised its rating on the server and networking company to Overweight. The stock ended the session at $54.67, having reached a high of $56.85.
The call is notable as HPE’s earnings forecast has outpaced its share price valuation. Morgan Stanley’s $71 target signals a 29.9% potential gain, despite the stock climbing about 130% this year.
The discount reflects future expectations. Using Monday’s closing price and Wall Street’s next-year earnings forecast of $4.02 results in a price-to-earnings ratio of 13.6. This is roughly 32% less than the S&P 500’s 20 times forward earnings multiple mentioned in the upgrade report.
Morgan Stanley’s Erik Woodring described HPE as the firm’s “preferred OEM to play the enterprise infrastructure cycle.” He indicated that the current setup presented compelling risk and reward. Investing.com
| Valuation gauge | Value | Investor reading |
|---|---|---|
| Monday close | $54.67 | Gained 2.73% during the day |
| Morgan Stanley target | $71.00 | Projecting a 29.9% potential gain |
| Consensus target | $68.82 | Suggests 25.9% possible increase |
| Next-fiscal-year EPS estimate | $4.02 | Implied P/E ratio stands at 13.6× |
| S&P 500 forward benchmark | 20.0× | HPE is priced 32% below benchmark |
The target and earnings forecasts are based on up-to-date analyst information. Morgan Stanley lifted its target price to $71, up from $69, as the consensus analyst target is currently $68.82.
HPE’s shift is reflected in its performance. Revenue for the fiscal second quarter rose to $10.68 billion, compared to $7.63 billion in the same period last year. Adjusted earnings saw an increase of over twofold.
Networking drove much of the growth, as revenue in that segment surged 148.2% to $2.7 billion following HPE’s integration of its portfolio with Juniper Networks.
Chief Executive Antonio Neri said, “Customers continue to invest in modernizing their infrastructure and scaling AI,” as HPE announced its quarterly results. HPE Investor Relations
| Fiscal Q2 metric | Q2 2026 | Year-on-year change |
|---|---|---|
| Revenue | $10.68 billion | up 40.0% |
| GAAP gross margin | 36.5% | increase of 810 basis points |
| Non-GAAP diluted EPS | $0.79 | jumped 108% |
| Networking revenue | $2.7 billion | rose 148.2% |
| Data-center networking revenue | $320 million | surged 233.3% |
| Free cash flow | $915 million | higher by $1.8 billion |
HPE’s reported results confirm all key operational numbers. The company lifted its fiscal 2026 adjusted EPS outlook to a range of $3.35 to $3.45 and projected a minimum of $3.5 billion in free cash flow.
Monday’s increase surpassed changes seen in other hardware makers. Dell Technologies NYSE:DELL and Super Micro Computer NASDAQ:SMCI both rose roughly 1%. International Business Machines NYSE:IBM declined by 0.53%.
| Company | Close | Daily move | Market value | Trailing P/E |
|---|---|---|---|---|
| Hewlett Packard Enterprise | $54.67 | up 2.73% | $78.3 billion | 50.2× |
| Dell Technologies | $458.12 | up 0.96% | $300.5 billion | 36.5× |
| Super Micro Computer | $31.44 | up 0.98% | $21.8 billion | 15.1× |
| IBM | $236.03 | down 0.53% | $224.9 billion | 20.9× |
Final Monday prices and valuations are shown. HPE’s elevated trailing multiple compared to its forward multiple results from acquisition-related items and other adjustments included in currently reported earnings.
Wall Street’s outlook continues to show a broad spread. The latest call introduces an additional bullish rating, though neutral stances persist, highlighting ongoing worries about the duration of the hardware cycle.
| Date | Firm | Recommendation | Price target |
|---|---|---|---|
| Aug. 10 | Morgan Stanley | Upgraded to Overweight from Equal-Weight | $71, previously $69 |
| Jul. 24 | Citigroup | Buy, rating maintained | $74, up from $70 |
| Jun. 2 | Goldman Sachs | Buy, rating maintained | $79, previously $32 |
| Jun. 2 | Loop Capital | Raised to Buy from Hold | $75, previously $23 |
| Jun. 2 | JPMorgan | Overweight, rating maintained | $68, up from $37 |
| Jun. 2 | Wells Fargo | Equal-Weight, rating maintained | $67, previously $26 |
Analyst actions followed HPE’s earnings revision and the Morgan Stanley upgrade on Monday. The price targets listed span from $67 to $79, while HPE closed at $54.67 on Monday.
Risks: HPE shares have already risen over 100% this year. Any slowdown in enterprise orders, rising component costs, supply shortages or demand that has been accelerated from upcoming quarters could put pressure on the higher earnings multiple. The integration of Juniper introduces further execution risk.
The upcoming assessment is guidance for the fiscal third quarter. HPE projects revenue between $11.5 billion and $12.1 billion, with adjusted EPS forecast at $0.88 to $0.93. The midpoint of the revenue outlook signals 10.5% sequential growth. Achieving that rate will determine if the 13.6-times forward valuation represents a bargain or a caution sign.
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