The price of HP’s (HPQ) shares has declined by more than 15% since hitting its $36 all-time high last month on speculation that global semiconductor chip shortage will have a negative impact on the pandemic-driven exponential growth of personal computer sales. Nevertheless, HPQ reported impressive financials in its fiscal second quarter, which ended April 30, 2021. And in June, HPQ acquired HyperX, the gaming division of Kingston Technology Company. So, is the stock’s current price level a good entry point? Let’s find out.HP Inc.’s (NYSE:HPQ) broad product portfolio includes personal computing devices, and imaging and printing products. It also offers 3D printing solutions. The stock has lost 14.5% over the past month and is currently trading 15.5% below its $36 all-time high, which it hit on May 10. The price decline can be attributed primarily to investors’ speculation that the growth of personal computers, which has peaked amid the COVID-19 pandemic, could be slowed by the global semiconductor chip shortage, which could be detrimental to HPQ’s growth.
Even though HPQ may experience a temporary slowdown due to the chip shortage, its fundamentals are strong, and the company has a strong foothold in the computer hardware space. It had a stellar performance in its fiscal second quarter (ended April 30, 2021) with double-digit top- and bottom-line growth.
The company also completed the acquisition of HyperX on June 1, which is expected to drive growth in its Personal Systems business, where gaming and peripherals are fast-growing segments. HyperX’s award-winning product portfolio spans a range of gaming peripherals, including headsets, keyboards, mice, mouse pads, USB microphones, and console accessories. The acquisition supports HP’s strategy to drive growth in its Personal Systems business, where gaming and peripherals are attractive segments.