Everyone knows turning a battleship is a lot harder than turning a tugboat. The same is true with stocks. Big caps like Hewlett Packard Enterprise sometimes take longer than smaller, nimbler companies to react to market changes. But it may be worth owning a battleship. The Relative Strength (RS) Rating for Hewlett Packard Enterprise (HPE) jumped into a new percentile Tuesday, as it got a lift from 69 to 73.
The 73 Relative Strength Rating, out of a best-possible 99, means that Hewlett Packard Enterprise has outperformed 73% of all stocks, regardless of industry group. It’s a good but not great rating. Top companies often have an RS Rating of 80 or higher when they begin their biggest runs. See if HPE can form a new base and break out.
Turning Like A Battleship
Hewlett Packard Enterprise was slow to recover from the coronavirus market low in March 2020. As late as the end of October it was only trading for 8.29, just above its March low of 7.43. However, its maneuvered better lately and it closed at 14.76 Tuesday, down for the day but nearly double its October low.
Hewlett Packard Enterprise was born in 2015 after it split from sibling HP Inc., a division of the iconic electronics company that was founded in a Silicon Valley garage in 1939. HP Enterprise offers an edge-to-cloud platform for enterprises, including software, servers and its Cray brand supercomputers. It has a roughly $26 billion run rate.
Regarding top and bottom line numbers, Hewlett Packard Enterprise has posted three quarters of increasing earnings growth. In its most recent quarter, HPE reported a 4% increase in EPS to 52 cents. Revenue gains have not followed the same trajectory, dipping 2% last quarter to $6.83 billion.
Hewlett Packard Enterprise holds the No. 26 rank among its peers in the Computer-Technical Services industry group. Perficient (PRFT) and NIC (EGOV) are among the group’s highest-rated stocks.
See How IBD Helps You Make More Money In Stocks
Hewlett Packard Enterprise is now considered extended and out of buy range after clearing a 12.47 buy point in a first-stage flat base. See if the stock forms a new chart pattern or follow-on buying opportunity like a three-weeks-tight pattern or pullback to the 50-day or 10-week line.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.
IBD’s proprietary rating identifies market leadership with a 1 (worst) to 99 (best) score. The grade shows how a stock’s price performance over the trailing 52 weeks holds up against all the other stocks in our database.
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