HP Inc upgraded at KeyBanc on stronger PC and printer demand

Investing.com -- KeyBanc Capital Markets upgraded HP Inc to Overweight from Sector weight on stronger-than-expected demand for personal computers and printers that would lift earnings in coming years.

The brokerage raised its price target to $30 from $28.10, implying about 17% upside, and increased its fiscal 2026-27 earnings forecasts by about 7%.

HP’s PC shipments rose 10.7% year-over-year in the September quarter, according to data from IDC and Omdia, well above KeyBanc’s earlier projection of 6% growth.

The firm now expects HP’s PC volumes to grow 5.1% in fiscal 2025 and 6.9% in fiscal 2026, supported by a global upgrade cycle as Microsoft ends support for Windows 10 next October.

Omdia estimates about one-fifth of older PCs cannot meet the hardware requirements to run Windows 11, suggesting a replacement boost.

Printer demand also looks firmer, KeyBanc said, as rival manufacturers have followed HP in raising prices, easing pressure on volumes. HP’s printer hardware sales fell 9% in the latest quarter, but KeyBanc expects smaller declines ahead.

The brokerage added that tariff risks are overstated because HP no longer imports significantly from China to the United States, and higher costs have already been priced into its products. It forecast non-GAAP earnings to rise 14.2% in fiscal 2026 after a 7.4% drop in 2025.

At current levels, HP trades at about seven times expected 2026 earnings, below its five-year average of 8.5 times, KeyBanc noted. The firm said the discounted valuation, combined with improving business momentum, makes the stock more attractive.

Shares of HP have fallen about 2% so far this year, currently trading at $27.45

You May Also Be Interested In