Topic: Growth Stocks

Wall Street Stock Forecaster Hotline – Friday, October 10, 2014

Article Excerpt

HEWLETT-PACKARD CO., $33.50, New York symbol HPQ, plans to break itself into two separate companies. The first firm, called Hewlett-Packard Enterprise, will sell computing products, like servers and analytics software, to businesses and governments. It will also offer cloud computing services and financing. Hewlett-Packard Enterprise will have annual revenue of $58.4 billion and $6 billion of gross profits. Meg Whitman, Hewlett’s current chief executive officer, will become its CEO. The second company, called HP Inc., will focus on the slower-growing personal computer (59% of its revenue) and printer (41%) markets. It will have annual revenue of $57.2 billion and $5.4 billion of profits. Ms. Whitman will be its chairman. Hewlett will hand out shares in both firms to its shareholders in November 2015. Investors are not liable for capital gains taxes until they sell their new shares. The company rejected a similar plan in 2011. However, Hewlett’s recent restructuring plan, which involved cutting jobs and simplifying its product lines, has increased its profit margins and…