Jump to content

HPQ - Barron's article


Guest kumar
 Share

Recommended Posts

Guest kumar

Where Does the Buck Stop at Hewlett-Packard?

 

http://online.barrons.com/article/SB50001424052970203869804576327380332107012.html?mod=BOL_twm_col

 

....HP is unusual in corporate governance in that it has an aggressive, powerful board that is packed with tech luminaries....Just how much control is in the hands of Apotheker, and how much in the hands of the board?....

 

....board has as its nonexecutive chairman the legendary Ray Lane, who was an executive at Oracle (ORCL) and who is prominent in venture-capital investing. Lane last year shook up HP's board, appointing four new members, including Meg Whitman, formerly the CEO of eBay (EBAY).

As impressive, if not as much an old hand, is Marc Andreessen, who helped found Netscape and who has made quite a name for himself as an astute venture capitalist.

Andreessen and his associates just a week ago succeeded in one of the most impressive corporate M&A deals in recent history, selling Skype to Microsoft (MSFT) for $8.5 billion.....As one investor tells me, "Don't bet against Ray Lane and Marc Andreessen" in having their finger on the pulse of where technology is headed.

Now, that's a terrific asset, provided the board is fully behind Apotheker.....for the moment I'm going to give Apotheker the benefit of the doubt, and assume that the star-studded board is going to help, not hinder him.....

 

 

 

 

 

 

Link to comment
Share on other sites

Where Does the Buck Stop at Hewlett-Packard?

 

http://online.barrons.com/article/SB50001424052970203869804576327380332107012.html?mod=BOL_twm_col

 

....HP is unusual in corporate governance in that it has an aggressive, powerful board that is packed with tech luminaries....Just how much control is in the hands of Apotheker, and how much in the hands of the board?....

 

....board has as its nonexecutive chairman the legendary Ray Lane, who was an executive at Oracle (ORCL) and who is prominent in venture-capital investing. Lane last year shook up HP's board, appointing four new members, including Meg Whitman, formerly the CEO of eBay (EBAY).

As impressive, if not as much an old hand, is Marc Andreessen, who helped found Netscape and who has made quite a name for himself as an astute venture capitalist.

Andreessen and his associates just a week ago succeeded in one of the most impressive corporate M&A deals in recent history, selling Skype to Microsoft (MSFT) for $8.5 billion.....As one investor tells me, "Don't bet against Ray Lane and Marc Andreessen" in having their finger on the pulse of where technology is headed.

Now, that's a terrific asset, provided the board is fully behind Apotheker.....for the moment I'm going to give Apotheker the benefit of the doubt, and assume that the star-studded board is going to help, not hinder him.....

 

 

 

 

 

 

 

Leo comes from a company SAP where there is 2 CEOs not one. He must be accustomed to power/responsibility sharing

I do not think he has to restructure the company either. It is a matter of tweaking and putting the focus on the right directions.

Link to comment
Share on other sites

From the conference call recently -- it's interesting that share buybacks are part of their "motto".  They clearly prefer it over dividends, which is great given where the stock is at right now.  And they will surely be heading down that road hand over fist given the fact that they've laid out a 2014 earnings target that requires 12% compounding growth in EPS.  Right now they get approximately 14% growth in EPS on every dollar of earnings spent on their own shares (perhaps buybacks are the most explicit example of value being it's own catalyst, the deeper the value the greater the catalyst).  The DOW doesn't return 14% long term, so let's see how long this lasts.  I don't even think the DOW has returned 10% long term, which would imply a 50% gain from here by next year.

 

 

Ben Reitzes - Barclays: Leo, you recently laid out $7 earnings figure for 2014. After doing $5 this year, I think it takes 12% EPS growth each year to get there. So, my question is, can you still get there based on what we heard today and how? Then I just was hoping Cathie to clarify the near-term guidance. It seems like the cut for 3Q versus the Street is two-third services, one-third Japan and consumer. I just wanted to clarify that?

 

Leo Apotheker - President and CEO: So, let me answer your question first. We are making tough decisions today to set us up for the future, and in the long term, we have multiple levels to drive our EPS growth, but investments we're making today will help create sustainable growth, including sustainable EPS growth. We are focused on an improved business mix and continued operational excellence including a better mix in each one of our businesses. For example, in services, as demonstrated by today's public decision, our long-term motto is to grow operating profit faster than revenue and EPS faster than operating profit. So, yes, I can confirm that we are maintaining our $7 EPS.

 

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...