Here's Why You Should Retain HPQ Stock in Your Portfolio Now

HP Inc. HPQ shares have gained 11.4% in the past year, underperforming the Zacks Computer - Micro Computers industry and Zacks Computer and Technology sector and the S&P 500 index’s return of 18.1%, 27% and 24.4%, respectively. Although HP has underperformed its industry and the broader tech sector, its persistent efforts on product innovation and differentiation are enabling it to adapt to changing trends.

For instance, HPQ is set to capitalize on the latest artificial intelligence (AI) wave. Per a report by Gartner, AI-based laptops and personal computers shipment will experience year-over-year growth of 165.5% in 2025. HPQ has broadened its product portfolio by introducing AI-powered personal computers and laptops, offering advanced tools to consumers to fully harness the potential of AI.

HP’s AI Portfolio Drives Growth

Throughout the past year, HPQ has introduced AI-based computing devices like HP OmniBook Ultra Flip 14-inch Next-Gen AI PC, HP EliteBook X 14-inch Next-Gen AI PC, Z by HP Gen AI Lab, HP OmniBook X AI PC, HP EliteBook Ultra AI PC, HP OmniBook Ultra laptop and HP OmniStudio PC.

HPQ’s continuous AI-based product launches led its AI PC units to contribute to more than 15% of HPQ’s PC shipments. A past report by Canalys suggests that HP has the largest market share of AI PC in the Windows ecosystem.

HPQ 1 Year Price Performance Chart

Image Source: Zacks Investment Research

To maintain its leadership in the AI-computing space, HPQ began 2025 with the launch of the OMEN Max 16 Laptop integrated with OMEN AI technology and AI-driven one-click performance optimization technology. The company also introduced the HP EliteBook X G1i 14-inch Notebook Next-Gen AI PC and HP EliteBook X Flip G1i 14-inch business notebook Next-Gen AI PC.

HPQ has also upgraded its Printer business with the integration of AI. In 2024, HPQ launched HP Print AI, the first-of-its-kind intelligent print technology that uses AI to improve the printing experiences of people at home. HP has ventured beyond the integration of AI in its 2D printing products.

To enhance the experience for users of HP 3D printers, HPQ has partnered with Fabrex to provide its customers with an AI-driven platform that streamlines build preparation, order management and tracking.

Rising Competition in the AI Space

The rapidly expanding AI market presents unique challenges, such as the influx of numerous companies flooding the market with their AI products. HP faces stiff competition from other companies, including Lenovo LNVGY and Dell Technologies DELL, which are also launching AI-based products. In the printing space, HPQ faces competitive pressure from Canon CAJPY.

Dell has numerous workstations that offer AI capabilities. These workstations are XPS 13, Inspiron 14 Plus, Inspiron 14, Latitude 7455 and Latitude 5455. Lenovo’s lineup of AI computers includes the Lenovo ThinkPad X1 Carbon 10th Gen and later, Lenovo Yoga 9i and Lenovo ThinkBook Plus Gen 3.

In the printing space, Canon has integrated AI in its imagePROGRAF series of professional photo printers like the imagePROGRAF PRO-1000 to improve image production and color management. Increased competition in these arenas poses the risk of market saturation, potentially slowing down HPQ’s top-line and bottom-line growth.

HPQ’s fiscal 2025 and 2026 revenues are expected to grow 2.89% and 2.73%, respectively. HP’s fiscal 2025 and 2026 earnings are expected to grow 5.33% and 6.22%, respectively.

HP beat the Zacks Consensus Estimates for earnings in one of the trailing four quarters, missing twice and matching once, the average negative surprise being 0.83%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Conclusion: Hold HPQ Stock Now

HPQ is capitalizing on the rapidly expanding AI PC     market with the introduction of AI-based computing products for consumers. However, this market is also experiencing an influx of other established players, making the market highly competitive. Considering all these factors, investors should hold on to this Zacks Rank #3 (Hold) stock at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

To read this article on Zacks.com click here.

Zacks Investment Research