Analyst downgrades HP as it faces mobile pressures
NEW YORK (AP) — Shares of Hewlett-Packard Co. fell on Friday after an analyst downgraded the stock because of worries that tablet computers and smartphones could hurt some of the technology company’s businesses.
In cutting his rating and price target, Peter Misek of Jefferies & Co. said that tablet computers such as Apple’s iPad are likely to hurt HP’s PC business.
PC makers have been hoping for a boost later this year when Microsoft Corp. updates its Windows operating system to incorporate touch-screen and other features popular with tablet computers, but Misek said Windows 8 could ‘‘accelerate tablet cannibalization as the operating system focuses on touch.’’
Misek also believes that smartphones are now used by enough consumers — and tablets to a lesser degree — that it is lowering printing demand.
The financial pressure has been building on HP since the company replaced cost-cutting specialist Mark Hurd as its CEO amid questions about his relationship with a former actress who worked for the company as a contractor. Since then, HP has had trouble responding to the threat posed to personal computers and printers by the rising popularity of mobile devices. Hurd’s successor was replaced after less than a year on the job.
HP, the world’s No. 1 maker of personal computers, plans to eliminate 27,000 jobs, or about 8 percent of its nearly 350,000 employees, by October 2014.
Aside from pressures from tablets and smartphones, Misek says uncertainty in Europe seems to be causing a slowdown in information technology spending. This is a concern for HP, as it gets one-third of its revenue from Europe, the Middle East and Africa, he explained.
‘‘We believe that information technology budgets are up 3 percent to 5 percent for 2012 but that corporate information technology departments are taking a cautious outlook, especially as we approach the Greek elections,’’ Misek said.
The analyst lowered HP to ‘‘Hold’’ from ‘‘Buy’’ and reduced his price target to $23 from $30.
HP’s stock fell $1.02, or 4.5 percent, to $21.66 in morning trading Friday. The stock fell to a 52-week low of $20.57 on May 23 and traded as high as $37.70 last July.
HP did not immediately respond to an email seeking comment.