TLDR
- Hewlett Packard Enterprise announces fiscal Q3 2026 results September 2 following market hours
- Company projects revenue between $11.5B-$12.1B with non-GAAP EPS of 88-93 cents
- Analysts at J.P. Morgan anticipate upward revision to full-year outlook based on AI and traditional infrastructure strength
- HPE shares have surged 126.6% in 2025 but maintain attractive 13x forward earnings ratio
- J.P. Morgan maintains Overweight stance with $70 target price
Hewlett Packard Enterprise (HPE) will unveil third-quarter fiscal 2026 financial results on September 2 following the closing bell. Despite shares climbing 126.6% year-to-date, market watchers believe the stock remains undervalued.
Hewlett Packard Enterprise Company, HPE
Management has projected Q3 revenue ranging from $11.5 billion to $12.1 billion. Analyst consensus aligns with the upper bound at $12.1 billion, representing approximately 32% expansion versus the comparable prior-year period.
For profitability metrics, HPE forecasts non-GAAP earnings per share between 88 and 93 cents. The Zacks consensus estimate stands marginally higher at 94 cents, reflecting a 113.6% increase year-over-year. This projection has seen upward revisions throughout the last month.
The company has surpassed consensus earnings projections in its previous four quarterly reports, delivering an average beat of 16%. This consistent performance provides market observers with optimism approaching Wednesday’s release.
J.P. Morgan’s Joseph Cardoso anticipates HPE will elevate its full-year revenue and profit projections. His outlook highlights momentum in conventional server platforms, campus networking infrastructure, and cloud routing technologies as primary catalysts.
“We expect tailwinds across both AI and non-AI infrastructure to support a further raise to HPE’s revenue and earnings outlook for FY26,” Cardoso said.
Artificial intelligence infrastructure represents a particularly compelling expansion catalyst for the quarter. The company has accelerated investments in AI inference capabilities, agentic AI frameworks, and data-heavy workload platforms, bolstered by its strategic alliance with NVIDIA.
AI and Private Cloud in Focus
The company’s AI Factory and Private Cloud AI solutions, developed in collaboration with NVIDIA, target enterprise implementations spanning data center facilities and edge computing locations. Momentum in these product lines is anticipated to have accelerated order volumes and backlog accumulation during Q3.
The completed Juniper Networks transaction remains strategically significant. This deal broadened HPE’s networking capabilities encompassing campus infrastructure, data center switching equipment, routing technology, and security solutionsāall projected to enhance Q3 performance.
GreenLake, the company’s consumption-oriented IT framework, enables clients to orchestrate on-premises infrastructure, colocation facilities, and public cloud resources. Strategic purchases of Morpheus and OpsRamp have enriched this platform with enhanced automation and monitoring functionalities.
Valuation Still Looks Low
Notwithstanding HPE’s substantial stock appreciation this year, its valuation metrics remain significantly compressed versus competitors. The company commands a forward price-to-sales ratio of 1.45x, contrasting sharply with the sector benchmark of 5.26x.
Trading at 13x forward earnings, HPE maintains a valuation discount relative to most industry counterparts, which typically command multiples exceeding 20x. Cardoso characterized this positioning as presenting “highly digestible near-term risk-reward” for market participants.
Shares have actually declined nearly 10% following the previous quarterly announcement, while the S&P 500 advanced approximately 1% during the identical timeframe.
J.P. Morgan sustains an Overweight recommendation alongside a $70 price objective on HPE. The firm’s consensus adjusted EPS projection for Q3 stands at 93 cents, with anticipated revenue reaching $11.94 billion.
The enterprise technology provider delivered robust operating and free cash flow performance in Q2 while maintaining shareholder returns via dividend distributions and share repurchase activity.
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