Hewlett-Packard Company (HPQ)’s Only Hope is A Miracle Acquisition: Daniel Ives

Hewlett-Packard Company (NYSE:HPQ)‘s CEO Margaret Whitman promised the company’s investors that she is going to turn her company around with moves that perhaps do not have a parallel. Although she has been able to revive the stock that was trading in low teens about two years ago, when she  took her seat at the company’s helm, Daniel Ives, vice president at FBR Capital Markets, thinks her endeavors might be going to waste.

On Bloomberg, Ives expressed his view that the only hope for the provider of technological products is a meaningful acquisition. Without that, Hewlett-Packard Company (NYSE:HPQ) looks to be onboard a sinking ship along with the likes of International Business Machines Corp. (NYSE:IBM).

“[…] It all comes down to can they get growth in the enterprise? I believe that it is really going to come down to an acquisition. They will have to make a game changing acquisition in Big Data, Cyber security, Cloud, obviously all the EMCs, that is what could really significantly change the mood here. Put them with International Business Machines Corp. (NYSE:IBM) and some of these other […],” said Ives.

Hewlett-Packard Company (NYSE:HPQ) released its earnings for the company’s fourth quarter on 25th November, which did not exactly paint a rosy picture. The earnings beat the analyst estimates marginally, but revenues were below expectations.

For a company that is aiming to make a turnaround by diving into the enterprise and cloud services, revenues from both these segments reflected that Whitman’s efforts were perhaps going in vain. In fact Hewlett-Packard Company (NYSE:HPQ) saw the greatest decline in percentage terms in the enterprise services, which were down by an almost 7%. Sales from Enterprise products, on the other hand, also slid 4%.

As Ives mentioned there are several other companies who are trying to make a turnaround using the same strategy. This only makes the competition more fierce. Hence, an acquisition of a cutting edge technology in the sector that could potentially give Hewlett-Packard Company (NYSE:HPQ) an edge over its competitors, might be the only miracle that could help Whitman keep her word.

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