Barclays upgraded HPE to “overweight” and hiked its price target to $24
Hewlett Packard Enterprise Co (NYSE:HPE) stock is up 2.7% in premarket trading, after Barclays upgraded it to “overweight” from “equal weight” and hiked its price target from $20 to $24 — a 27.1% premium to last night’s close. In its bull note, Barclays said HPE is the best pick amid a rebounding enterprise server market.
The tech stock just bounced off the $16 level, which acted as resistance earlier this year. A bull gap helped Hewlett Packard stock notch a June 18, record high of $22.82, and more recently it reclaimed support from its 120-day moving average. Over the last 12 months, HPE added 11.2%.
Sentiment toward the equity is bearish, with nine of 13 covering brokerages in question carrying a “hold” rating. In other words, there is still plenty of room for analysts to turn bullish.
The stock’s Schaeffer’s put/call open interest ratio (SOIR) of 1.16 stands higher than all other readings from the past 12 months, meaning short-term options traders have favored puts of late. A shift in sentiment in the options pits may provide additional tailwinds for HPE.
Options look like an attractive play. Hewlett Packard stock’s Schaeffer’s Volatility Index (SVI) of 29% sits in the low 16th percentile of its annual range, which indicates options traders are pricing in low volatility expectations at the moment.