Bernstein says Dell and HPE are undervalued, sees attractive entry point By Investing.com

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Bernstein says Dell and HPE are undervalued, sees attractive entry point

Published Mar 19, 2023 15:58

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By Senad Karaahmetovic

Bernstein analysts reiterated Outperform ratings on Dell Technologies Inc (NYSE:DELL) and Hewlett Packard Enterprise Co (NYSE:HPE) as they believe shares are currently undervalued.

Their deep-dive into the financials of DELL, HPE, and HP Inc (NYSE:HPQ) for the last four years shows Revenues have come full circle and are essentially flat with pre-pandemic levels. The seasoned tech analyst also highlights flattish growth and profit generation, which is underscoring their long-term challenges.

“We view the names more as trading stocks than long-term holdings, but believe that DELL and HPE and overly discounted at current levels and offer favorable risk reward,” the analysts added.

HPE trades at 7X Bernstein’s FY23 EPS estimates, while Dell’s multiple stands at 8X.

On the other hand, HPQ is reiterated at Market Perform as the Bernstein analysts see it “as more structurally challenged than either DELL or HPE, with mean reversion in a potentially over-earning printing business as a downside risk.”

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Bernstein says Dell and HPE are undervalued, sees attractive entry point

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