Goldman Sachs reiterates Buy on HP Enterprise stock after earnings beat

Goldman Sachs has reaffirmed a Buy rating and set a price target of $75.00 for HP Enterprise (NYSE:HPE) after the company delivered impressive third-quarter fiscal 2026 earnings. The company reported earnings per share of $1.11, surpassing both Goldman Sachs' and FactSet consensus estimates. This positive outcome was fueled by higher-than-anticipated Cloud & AI revenue and improved Cloud & AI EBIT margins.

The fiscal 2027 outlook for HP Enterprise has been raised, with the company projecting revenue growth of 13% to 17%, up from a prior range of 8% to 12%. Additionally, operating margin guidance has been increased to 14% to 15%, from the previous range of 12% to 16%. Non-GAAP earnings per share growth expectations have also been lifted to 16% to 20%, from the previous range of 12% to 16%. Furthermore, free cash flow guidance has been expanded to at least $5 billion, up from at least $4.5 billion.

HP Enterprise has strengthened its partnership with Oracle, aiming to deploy networking platforms across multiple projects through a multi-year contract. The company also disclosed record order growth of 42% year-over-year, with server revenue increasing by 35%. Traditional server orders surged 75%, while AI systems orders reached $2.4 billion. Networking orders grew by 36%, with campus and branch refresh orders up in the low teens, and data center switching and routing expanding in the high double digits.

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