Activist investor Elliott Investment Management has acquired a stake of over USD 1.5 billion in Hewlett Packard Enterprise (HPE), according to Bloomberg. $HPE (+2.47%) in Hewlett Packard Enterprise (HPE). Elliott apparently wants to exert strategic influence on the company, particularly with regard to efficiency and profitability. The news caused HPE's share price to rise significantly.

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The news is based on what I personally consider to be reputable sources. No investment advice. Follow me for more updates!

After this correction I have learned some valuable things that I would like to share with you ✍️.

1° The Market doesn't Care how Undervalued a Stock looks 📉

I have seen from my own experience how a company like $HPE (+2.47%) fell almost 20% in days even below its book value, making a correction almost as big or bigger than other +30% P/E companies.

2° It is always necessary to keep cash reserves 💵

We cannot predict what the market will do but if we have cash reserves we can take advantage when the market drops by 7, 8, 10 or 20%.

And that's precisely what will probably make us outperform in the long run 🚀📈.

3° Investing in Value is Better than Investing in High Expectations 💰>💸

Although my portfolio has fallen other companies with much higher P/E ratios have corrected much more companies like $SPOT (+0.11%)
$SOFI (+5.85%)
$TSLA (+6.16%)
$SHOP (+6.77%) and a long list have corrected up to 40-50%.

I have been looking for opportunities in the market and I have come across the following companies, I would appreciate your feedback

$HPE (+2.47%) trades at 9x earnings, trades below book value, low profitability margins but 4-8% EPS growth expectations

$GMAB (+1.88%) trades at 17 times earnings, about 8 times current Ebitda, seems to have performed well historically (book value is not a good metric, probably has capitalized R&D expenses)

$AES (+3.44%) trades at about 4-5 times earnings, is dedicated to the generation of renewable energy, trades below its current book value for its historical performance does not seem to have done very well, but for its current valuation looks good, has a dividend of about 6% per annum

$CAT (+1.72%) it trades at about 15 times earnings and has had a good historical performance, leader in the production of construction machinery.

Why do you think the market values these companies so low? Do you see growth possibilities or investment opportunities?

$HPE (+2.47%) seems to be cheap, have you ever had any problems with auditing, security or anything like that?

Or is it that your products have a lower quality, in terms of cybersecurity or quality in general? Or can't you compete in the market?

Or maybe it's just that they've been mismanaged the last few years?

Because if it is not for any of these reasons I really don't get it 🤔.

In 2023 it was trading at 27x earnings and today it is barely at 9x earnings and yet it is expected to grow at an estimated 6-8% compounded growth over the next 3 years (Koyfin data)

On the other hand the number of shares outstanding has only gone down in the last 8 years

They have 17B of debt but also 13B of cash so their financial situation looks stable enough.

The Enterprise Value is estimated at 29B (although it is only an estimate of analysts) but it trades at 23B and the Net Book Value (The book value go) is above the price paid today for the shares on the stock exchange, ie theoretically (because for many reasons then reality is not so) if the company were closed tomorrow shareholders would receive more for its book value than for what the share itself is sold on the stock exchange 📈

The company is literally worth $17 per share on the market and just in accumulated cash it is worth $10/Share 🤷‍♂️

$HPE (+2.47%) Hewlett Packard Enterprise Co. (HPE) announced its results for the first quarter of fiscal year 2025 on Thursday:

• Earnings: net income was $627 million, which equates to earnings per share (EPS) of $0.44. Adjusted for one-off costs, EPS was USD 0.49, just below analysts' estimates of USD 0.50.

• Revenue: Revenue amounted to USD 7.85 billion, exceeding the consensus estimate of USD 7.81 billion.

Forecast:

• For the second quarter of fiscal 2025, HPE expects earnings per share between $0.28 and $0.34 and revenue between $7.2 billion and $7.6 billion.

• For the full fiscal year 2025, the company forecasts earnings per share in the range of USD 1.70 to USD 1.90.

https://youtu.be/6nxjeZ1Hx-g?si=PwApFyxaH4YrAIrz

Broadcom shines

Broadcom $AVGO (-1.26%) is in the starting blocks to present its results for the quarter ending January 31, 2025 on March 6, 2025. The experts are unanimous: expectations are shooting through the roof! They expect earnings per share of an impressive USD 1.51, compared to just USD 0.290 in the same quarter of the previous year. That's a real leap forward! It will also be exciting in terms of turnover, as 30 analysts expect an average increase of 22.19 percent to USD 14.62 billion. Last year, the figure was USD 11.96 billion. For the current fiscal year, 37 analysts are looking at earnings of USD 6.37 per share, which represents a massive increase on the USD 1.27 in the same period last year. Turnover is expected to climb to USD 61.55 billion, up from USD 51.57 billion in the previous year.

Lufthansa raises revenue expectations

There is also positive news in the USA and Europe: Lufthansa $LHA (+0.63%) will publish its quarterly figures on 06.03.2025, which were collected until 31.12.2024. Here, 5 analysts have agreed on earnings per share of EUR 0.201, which represents a significant increase compared to EUR 0.060 in the same quarter of the previous year. Turnover also looks promising: An increase of 8.26 percent to EUR 9.49 billion is forecast, following EUR 8.76 billion in the previous year. For the past fiscal year, 20 analysts expect average earnings of EUR 0.867 per share, which is a small step backwards compared to the EUR 1.40 in the previous year. However, turnover is expected to rise to EUR 37.57 billion, compared to EUR 35.44 billion in the previous year.

Hewlett Packard Enterprise convinces

Hewlett Packard Enterprise $HPE (+2.47%) will also present its figures for the quarter ending January 31, 2025 on March 6, 2025. Analysts are optimistic and expect earnings per share of USD 0.497, up from USD 0.300 in the prior-year quarter. In addition, analysts expect turnover to increase by 16.10% to USD 7.81 billion, compared to USD 6.73 billion in the previous year. Forecasts for the fiscal year are also positive: 14 analysts expect earnings per share of USD 2.13, compared to USD 1.95 in the previous year. Turnover is expected to rise to USD 32.50 billion, compared to USD 30.07 billion in the previous year.

Sources:

https://www.finanzen.net/nachricht/aktien/zahlen-voraus-ausblick-broadcom-praesentiert-das-zahlenwerk-zum-abgelaufenen-jahresviertel-14292079

https://www.finanzen.net/nachricht/aktien/bilanz-ante-portas-ausblick-lufthansa-legt-quartalsergebnis-vor-14292091

https://www.finanzen.net/nachricht/aktien/zahlen-im-blick-ausblick-hewlett-packard-enterprise-legt-zahlen-zum-juengsten-quartal-vor-14292078

- Monday: $GTLB (+0.12%) , $OKTA (+1.43%) .

- Tuesday: $CRWD (+1.59%) , $FLTR (+3.54%) , $ONON (-3.44%) , $TGT (+4.29%) , $SE-ED .

- Wednesday: $MDB (-1.68%) , $MRVL (+6.71%) , $VEEV (-0.85%) , $ZS (+0.92%) .

- Thursday: $AVGO (-1.26%) , $COST (+0.67%) , $HCP , $HPE (+2.47%) , $27C , $JD. (+0.52%)

Aftermarket after quarterly figures, 05.12.

$ASAN (+1.17%)
$RBRK (+1.47%) +15.82%

$DOCU (-2.56%)
$ULTA (-0.16%)
$GTLB (+0.12%)
$LULU (+2.77%)

$VEEV (-0.85%)
$PATH (+0.28%)
$VSCO (+5.67%)
$HPE (+2.47%)
$IOT -6.58%