TLDR
- Bank of America elevated HPE’s price target to $38 — the highest on Wall Street — while reaffirming its “Buy” recommendation
- First quarter FY2026 results showed revenue reaching $9.3 billion, an 18% year-over-year increase, with earnings per share of $0.65 surpassing projections
- Following the Juniper Networks deal, the Networking division skyrocketed 152% to $2.7 billion in revenue
- Shares of HPE have climbed approximately 73% in the trailing twelve months, reaching a record peak of $29.63
- Institutional ownership stands at 80.78% of outstanding shares; analyst consensus points to “Moderate Buy”
Bank of America has upgraded its price objective for Hewlett Packard Enterprise to $38 — a significant jump from the previous $32 target — establishing a new high-water mark among Wall Street firms. The financial institution maintained its “Buy” recommendation while highlighting “agentic AI” as an emerging catalyst for HPE’s infrastructure operations.
Hewlett Packard Enterprise Company, HPE
Led by analyst Wamsi Mohan, the BofA research team views HPE as a leading supplier of premium AI servers, strategically positioned to capture market share as sophisticated AI workloads become increasingly mainstream. The firm projects HPE will deliver approximately $6.5 billion in AI server sales throughout 2026.
The new $38 price objective represents potential upside of around 34% from present trading levels. Shares opened Thursday at $28.30, trading within a 52-week band spanning $15.71 to $29.63.
HPE’s latest quarterly performance delivered substantial validation for bullish investors. The technology giant reported first quarter FY2026 sales of $9.3 billion, representing an 18.4% year-over-year expansion. Adjusted earnings per share reached $0.65, exceeding the Street’s $0.59 estimate by six cents.
The headline grabber was the Networking division, which exploded 152% to $2.7 billion following completion of the Juniper Networks transaction. This segment currently contributes more than half of HPE’s consolidated operating income.
Non-GAAP gross margins expanded to 36.6%. The company also disclosed a record-setting $5 billion pipeline of AI system orders and strengthening demand for next-generation Wi-Fi 7 equipment.
Robust Forecast and Upgraded Full-Year Projections
For the second quarter of FY2026, HPE issued guidance calling for revenue in the $9.6 billion to $10 billion range, with adjusted earnings per share between $0.51 and $0.55. Management raised its full-year non-GAAP EPS outlook to a range of $2.30–$2.50.
Chief Executive Antonio Neri disclosed that the company’s “AI Factory” order objective has been increased to approximately $1.9 billion by fiscal year-end. This represents tangible evidence that customer appetite for HPE’s purpose-built AI infrastructure remains robust.
The enterprise generated $1.2 billion in cash from operations and distributed a quarterly dividend of $0.1425 per share during April 2026.
Institutional Ownership Continues Expanding
Several large institutional shareholders expanded their HPE allocations during the fourth quarter. Vanguard Group grew its position by 1.1%, currently managing over 173 million shares valued at roughly $4.16 billion. Viking Fund Management increased its holdings by 22.5%, while Merit Financial Group more than doubled its stake.
Vest Financial LLC expanded its position by 64.6%, acquiring an additional 42,629 shares to reach a total of 108,579.
Institutional investors collectively control 80.78% of HPE’s outstanding equity — a substantial percentage that demonstrates widespread institutional conviction in the company’s strategic trajectory.
Regarding insider transactions, company executives divested 602,337 shares totaling approximately $15.4 million during the previous 90 days, though these sales occurred under pre-established Rule 10b5-1 programs.
Despite Bank of America’s optimistic upgrade, the collective analyst consensus maintains a “Moderate Buy” recommendation with an average price target of $26.71 — modestly below current trading levels. Among 20 covering analysts, nine assign a “Strong Buy” rating, one offers “Moderate Buy,” and 10 maintain “Hold” recommendations.
HPE currently trades at a forward price-to-earnings multiple of approximately 14.6 times. Share performance over the past year shows gains of roughly 73%.
