HP Shares Face Persistent Selling Pressure as Critical Earnings Loom

The downward trajectory in HP's stock price continues to trouble market participants, raising fundamental questions about the technology manufacturer's prospects. With shares having shed more than a quarter of their value since January, attention now turns to upcoming quarterly results that could determine the company's near-term direction. What underlying factors are driving this sustained selling activity?

HP's equity has experienced a challenging period, declining over 28% year-to-date and currently trading approximately 40% below its annual peak. The past week proved particularly difficult for shareholders, with the stock retreating more than 5%. This performance significantly underperforms broader market indices, suggesting company-specific issues rather than sector-wide trends.

While third-quarter revenue figures provided a modest positive surprise, earnings per share aligned precisely with analyst projections—offering little catalyst for investor enthusiasm. The true test awaits: November 25 quarterly earnings will reveal whether HP can initiate a meaningful recovery.

Valuation Gap Presents Contradiction

The current valuation scenario presents an intriguing dynamic. HP trades at a substantial discount to technology sector averages, evidenced by a price-to-earnings multiple of just 9.2 compared to the sector's 23.2. Some financial analysts estimate intrinsic value around €50 per share—more than double the current trading level. Why then are investors reluctant to capitalize on this apparent bargain?

Should investors sell immediately? Or is it worth buying HP?

Market trends may provide explanation. Institutional investors display divided sentiment, with certain funds substantially reducing exposure while others cautiously increase positions. Potentially more concerning for market observers are recent transactions showing top executives, including CEO Enrique Lores, decreasing their direct share holdings.

Critical Juncture Approaches

All eyes focus on whether HP can deliver an upside surprise when it reports November 25. Fourth-quarter guidance projecting earnings between €0.87 and €0.97 per share offers a glimmer of potential. However, operating within a challenging technology landscape and facing persistent institutional skepticism, the company confronts a significant operational test.

The stock currently searches for stabilization—whether it establishes support near €20 or continues its descent will become clearer in coming weeks. One reality remains evident: HP requires more than merely meeting expectations; it needs to articulate a compelling growth narrative to restore investor confidence.