HP Secures Healthways Deal - Analyst Blog
31 5월 2011 - 11:23PM
Zacks
The largest PC manufacturer Hewlett-Packard
Company (HPQ) recently secured a 10-year outsourcing
contract worth $380.0 million from Healthways Inc. As per the terms
of the agreement, the PC maker will provide applications
development solutions and IT management services to Healthways.
This deal win is expected to strengthen the relationship between
the companies and help them pursue new opportunities in the
government and commercial markets.
Healthways is expected to take advantage of health care
applications offered by HP in order to provide public sector health
insurance programs with expertise in designing and delivering
well-being-improvement solutions.
The HP growth story remains intact given the company’s track
record of new deal wins and acquisitions. The company recently
signed a deal to acquire Printelligent, a closely held provider of
managed print services (MPS) for an undisclosed sum.
HP’s acquisition of Printelligent is a part of the company’s
strategy to optimize the traditional technology environment that
its customers depend on and deliver a connected world between the
customer and the enterprise.
On the other hand, management believes that the Services
division will focus on more profitable and higher-growth
categories, mostly in the cloud computing service segment. However,
this may result in a conflict of interest among major tech players
such as International Business Machine (IBM),
Oracle Corp. (ORCL) and other tech majors who have
already entered this competitive space.
Moreover, the company lowered its third quarter guidance based
on the negative impact of the earthquake in Japan, along with the
reduction of sales of personal computers, and lower operating
profit in its services unit as a result of reorganization of its
business units.
Hewlett-Packard reigns supreme in the computing world with its
strong business model and leadership position in both PC and Server
segments. The company is also challenging Cisco Systems
Inc. (CSCO) in the networking space.
Despite the company’s leading market position and compelling
product line, we remain cautious about future growth, especially as
competition from other big technology players, including
Cisco Systems
(CSCO), Apple
Inc. (AAPL), Acer, Microsoft
Corp. (MSFT) and Dell Inc. (DELL) heats
up.
However, we prefer to remain on the sidelines considering the
lowered revenue outlook, reflecting moderate demand for desktop
PCs, manufacturing problems in Japan and growing interest in
tablets. Moreover, HP lags its peer Apple in the tablet
vertical.
Currently, Hewlett Packard has a Zacks #4 Rank, implying a
short-term Sell recommendation.
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