Citigroup, BofA, 4 others cut HP price target
(Reuters) - At least six brokerages cut their price target on Hewlett-Packard Co (HPQ.N), citing its weak outlook and larger-than-expected shortfalls in consumer PC sales.
"We believe the larger-than-expected shortfall in consumer PCs is a product of HP's determination to reduce channel inventories ahead of Intel's Sandy Bridge transition," Citigroup said in a note to clients.
Last month, Intel Corp (INTC.O) launched the second-generation Sandy Bridge PC chips, which secure the streaming of high-definition movies from online movie services to PCs and are slated to replace the current generation of processor chips.
HP's fourth-quarter personal systems group sales slid a percent and giant services business revenue slipped 2 percent. It trimmed its 2011 revenue outlook on weak consumer PC demand and a dull showing from its IT services arm.
Brokerage Collins Stewart also cut its price target on the stock and said it believes investors have been frustrated with HP after the Hurd breakup.
HP's former chief executive officer Mark Hurd, credited with its turnaround to being a global PC giant, resigned in August following an investigation into his relationship with a contractor.
Shares of the company, which took a beating after Hurd's departure, have gained 4 percent since his resignation was announced on August 6.
HP shares were down 11 percent at $42.91 in morning trading on the New York Stock Exchange.
(Reporting by Siddharth Cavale and Swati Chitnis in Bangalore; Editing by Joyjeet Das)
Credit: Reuters (www.reuters.com)
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