HP Attempting To Lean Less On Promotional Pricing

Jeffrie's James Kisner maintains HP Inc (NYSE: HPQ) at Buy with a price target of $14.50. The reiteration came after HP saw Q3 adjusted EPS between $0.43–$0.46, higher than prior estimates of $0.39.

Kisner was impressed with the company's change in sales strategy "towards lessened reliance on promotional pricing activities." FY16 FCF guidance was lowered due to the change, but the analyst was satisfied with it because of the strategy's potential benefit for the company in the long run.

Related Link: Citi Skeptical On HP's Radical Shift In Its Supplies Pricing Model

Due to increased visibility in computer outlets and stores, HP announced it would shift its "pricing strategy to an everyday low price model" from a promotional pricing model, said Kisner. The new pricing strategy, along with increasing marketing spending will provide greater results to HP's sales, Kisner believed.

At the time of writing HP traded at $12.73, down 4.54 percent on the day.