Evercore Adds HPE to Outperform List Amid Strong AI Server Demand and Networking Outlook

Evercore ISI has added Hewlett Packard Enterprise to its "Outperform List", citing strong demand for AI servers and networking equipment. The firm expects HPE's core server business to improve due to a refresh cycle and cost-cutting initiatives. Evercore also notes that the acquisition of Juniper Networks will boost HPE's financial performance.

Hewlett Packard Enterprise (HPE) has been making significant strides in the realm of AI and networking, with recent innovations set to bolster its financial performance and drive growth. The company has announced major enhancements to its HPE Juniper Networking portfolio, advancing its AI-native Mist platform to deliver agentic AIOps through more autonomous, intelligent, and proactive network operations [1]. These enhancements include agentic AI-powered troubleshooting, expanded visibility and control of self-driving actions, a generalized Large Experience Model (LEM), and new AIOps features for data centers.

These innovations build on HPE's decade-long leadership in AI for networking, helping enterprises, cloud providers, and telcos drive greater efficiency, reliability, and user satisfaction. The company's Marvis Minis, twins that simulate user experiences, can predict future application experiences without real-time data from the applications themselves. This predictive capability is fed into the Marvis AI engine, where self-driving actions can be taken to optimize future performance before users even being present.

Moreover, HPE is uniquely positioned to unlock exceptional customer value by applying AIOps and agentic AI across multi-vendor full stacks, integrating outcomes from networking, compute, storage, virtualization, containerization, and applications. The latest Marvis data center capabilities complement HPE OpsRamp, an AIOps-powered IT operations management (ITOM) platform designed to simplify and automate the management of hybrid, multi-cloud, and on-premises IT environments with full-stack observability and advanced agentic workflows tailored for the modern data center.

The positive outlook on HPE's prospects has been echoed by financial analysts. Morgan Stanley upgraded HPE stock to ‘Overweight’ from ‘Equal Weight’ and raised its price target to $28, citing overlooked upside in the company’s recent acquisition strategy and AI-driven demand environment [2]. Additionally, Evercore ISI has added HPE to its "Outperform List," expecting strong demand for AI servers and networking equipment, and noting that the acquisition of Juniper Networks will boost HPE's financial performance.

In conclusion, HPE's advancements in AI and networking, coupled with a strong acquisition strategy, position the company well for future growth and financial success. As the market continues to embrace AI-driven solutions, HPE is well-equipped to capitalize on this trend and deliver exceptional value to its customers and shareholders.

References:
[1] https://www.marketscreener.com/news/hewlett-packard-enterprise-company-accelerates-self-driving-network-operations-with-new-mist-agentic-ce7c50d9de8df524
[2] https://stocktwits.com/news-articles/markets/equity/morgan-stanley-believes-hpe-is-undervalued/chsSysvRdih