We still see the glass as half full, given likely decent global economic growth, healthy corporate p...
Hewlett Packard: "A Bet on Meg Whitman"
03/24/2017 2:50 am EST
Meg Whitman, CEO of Hewlett Packard Enterprises (HPE), has been engaged in a slew of M&A activity to slim down the company.
HPE is carving off areas of operation that are not part of its core business, buying businesses that give HPE added value and widen its portfolio of products.
This recommendation is basically a bet on the “jockey,” Meg Whitman. Whitman has had a wildly successful career in tech. Earlier in her career (1998), she headed EBay (EBAY) as president and CEO.
In less than 10 years she took EBay’s annual revenue from just $4 million a year to $8 billion, expanding the number of employees in that time from 30 to over 15,000.
In 2011, she joined Hewlett-Packard when it was on the brink after its catastrophic acquisition of Autonomy.
Despite the acquisition of Autonomy, Whitman has improved Hewlett-Packard’s profitability. In addition, in 2016 almost 95% of Whitman’s total compensation was tied to company performance.
As HPE continues to spin off its non-core and less profitable businesses, it makes a takeover even more probable.
The recent downward pressure on the stock due to an earnings miss is giving us a good opportunity to buy a pure-play enterprise company, run by a great manager.
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