Hewlett Packard gains after Morgan Stanley upgrades to 'overweight'

Hewlett Packard Enterprise's HPE.N shares up 3.3% to $21.73 on Thurs after Morgan Stanley upgrades AI-server maker to 'overweight' from 'equal-weight'

Brokerage boosts PT by $6 to $28, implying 33% upside to stock's last close

The market continues to underestimate the full earnings power of HPE inclusive of Juniper Networks acquisition, Morgan Stanley analyst team led by Erik Woodring wrote in note

Woodring sees an improving networking landscape, as his checks and enterprise channel partners signaling a return to y/y networking growth

He sees a "clear path" to valuation multiple expansion post-Juniper, pointing to core networking peers trading at 16x P/E vs HPE currently at ~10x despite 40-50% of earnings expected to come from its combined networking business

Of 20 analysts covering HPE, recommendation breakdown is 11 "strong buy" or "buy" and 9 "hold" ratings and median PT is $24, per LSEG data

With move on the session, shares up ~2% YTD vs S&P 500 Tech sector's .SPLRCT ~12% advance