The Dividend Daily

PC and printer maker Hewlett-Packard Company (HPQ) on Tuesday received some bearish commentary from analysts at Citigroup.

The firm initiated coverage on HPQ with a “Sell” rating and $13.50 price target, suggesting a 7% downside to the stock’s Monday closing price of $14.46.

A Citigroup analyst commented, “We believe consensus EPS estimates are too aggressive for both 2013 and 2014. We believe the company is too optimistic in its PC & printing forecast of flat to up 1% through 2015 as we are concerned Lenovo will surpass HP as the #1 PC market share company and pressure HPs margins. We also fear HP will continue to lose more services opportunities given its heavy restructuring and management turnover. We see Lenovo aggressively moving into HP’s market. We note the stock is one of the weakest IT hardware performing stocks in 2012 with investor sentiment quite negative with short interest at all time levels so the sell rating may take a while for the stock keep going lower.”

Hewlett-Packard shares were mostly flat in premarket trading Tuesday.

The Bottom Line
Shares of Hewlett-Packard (HPQ) have a 3.67% dividend yield, based on last night’s closing stock price of $14.46. The stock has technical support in the $11.50-$12.00 price area. If the shares can firm up, we see overhead resistance around the $17-$18 price levels.

Hewlett-Packard Company (HPQ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 2.8 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.