Hewlett-Packard HPQ shares are volatile after the company announced better than expected third quarter earnings and raised guidance.
Revenue beat analyst expectations by 2.3 percent at $27.6 billion. This is a 1.4 percent improvement from the same period last year.
Personal systems sales increased 12 percent on an 18 percent climb in notebook unit sales. However, growth was dragged down by a shrinkage in the printing and enterprise service businesses.
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Earnings were inline at $0.89 per share. A 3.5 percent year over year increase in earnings compared to a 33 percent surge in stock price suggests significant multiple expansion.
CEO Meg Whitman says she is “very pleased” with the quarter and her “confidence in the turnaround,” is growing stronger.
HP also raised its full year 2014 guidance. EPS is expected in the range of $3.70 to $3.74, compared to $3.63 to $3.75 previously. The midpoint of the new estimate is inline with Wall Street’s expectation.
Fourth quarter earnings are expected between $1.03 and $1.07 per share.
The issue was last trading at $34.65, down 0.5 percent in extended hours trading.
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