What To Expect From HP Before Earnings

In a report published Monday, Cantor Fitzgerald analysts maintained a Hold rating on Hewlett-Packard Company (NYSE: HPQ), with a price target of $35, ahead of the company's F2Q15 earnings release.

Hewlett-Packard is scheduled to report its quarterly results on May 21. The analysts expect the company to miss the Cantor Fitzgerald revenue estimate of $26.2 billion, while struggling to achieve the EPS estimate of $0.88.

Hewlett-Packard may report a 4 percent y/y decline in its revenue, marking the 14th of the last 15 quarters in which sales have contracted. "That said, HP has expense levers it can pull from its downsizing program," the analysts wrote.

In the report Cantor Fitzgerald noted, "During 2Q:FY15, we believe HP will grapple with the impact of FX (37% of 1Q:FY15 sales from EMEA and 19% from Asia Pacific), weakness in China given the government's increased focus on domestic vendors, a softening PC market, and secular challenges across the IT landscape."

The analysts expect some of the headwinds to carry over into F3Q15 and project revenue of $25.9 billion, versus consensus of $26.0 billion, and EPS of $0.90, versus consensus of $0.87, which could "prove aggressive."