Hewlett Packard Enterprise shares climbed 19.4% over the past week as investors bought into AI infrastructure names following Oracle's latest earnings call. The rally lands alongside a bullish fiscal 2026 revenue outlook, a sharp jump in quarterly profit, and rising hedge fund ownership.
Hewlett Packard Enterprise (NYSE:HPE) gained 19.4% week-on-week as continued spending on artificial intelligence pushed investors to increase their exposure to the stock. The move followed Oracle's indication in an earnings call last week that it will keep pouring money into AI, a signal investors read as a reason to buy shares expected to benefit from the trend.
Record Backlogs Lift FY26 Outlook
Earlier this month, HPE signaled an optimistic outlook for its business, citing record backlogs in the third quarter driven by strong customer demand. For the full fiscal year 2026, the company is targeting revenue growth of 34% to 37%, with the networking segment expected to accelerate 73% to 74%.
Guidance calls for earnings per share of $2.93 to $3.03 on a GAAP basis, or $3.75 to $3.85 on a non-GAAP basis. For the fourth quarter alone, HPE targets revenue of $13.9 billion to $14.8 billion, with GAAP EPS of $1.12 to $1.22 and non-GAAP EPS of $1.20 to $1.30.
Profit Jumps as Cloud and Networking Grow
Last quarter, HPE's net income attributable to shareholders surged 447% to $1.511 billion, up from $276 million in the same period a year earlier. Net revenue rose 33.7% to $12.2 billion from $9.14 billion year-on-year, with cloud revenue contributing the largest share at $9 billion, up 25.4% year-on-year. Networking revenue grew 74.9% to $2.9 billion.
Dividend Deadline Meets Rising Hedge Fund Interest
HPE's board approved a dividend of $0.1425 per share, payable October 16, 2026, with Thursday, September 17 set as the new cutoff date for eligibility. Investors are expected to load up on shares ahead of that date.
Institutional investors have also grown more bullish on the stock. Data from Insider Monkey show 85 hedge funds held HPE positions in the second quarter, up from 58 in the first quarter, while their collective holdings rose 77.4% to $5.66 billion from $3.19 billion quarter-on-quarter.
Source: Insider Monkey
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