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HOUSTON--(BUSINESS WIRE)--HPE (NYSE: HPE) today announced the appointment of David Goulden to its Board of Directors, effective today. Goulden joins the Board's Finance & Investment Committee and HR & Compensation Committee. Goulden brings more than 35 years of experience, including extensive management and financial leadership at global technology companies. Most recently, he served as Executive Vice President and Chief Financial Officer of Booking Holdings Inc., the global online trav.

WASHINGTON--(BUSINESS WIRE)---- $HPE #GenesisMission--HPE (NYSE: HPE) today announced it has been selected to participate in multiple key research and development (R&D) projects in the first phase of the U.S. Department of Energy's Genesis Mission. The awarded projects focus on advancing AI innovation and scientific discovery across AI model application, performance optimization, networking, cybersecurity, and water availability. In addition to contributing to critical R&D, HPE is delivering some of the world's.

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SummaryHewlett Packard Enterprise is evolving from a server vendor to a dominant owner of the networking layer, driving a higher-margin, less cyclical business mix.Networking now delivers 27% of HPE revenue but nearly 44% of segment profit, with Juniper and Aruba platforms fueling rapid margin expansion and growth.The H3C divestiture transforms HPE into a cleaner Western infrastructure asset, reducing geopolitical risk and compressing its risk premium.I rate HPE a buy with 15–20% upside, supported by strong growth, margin expansion, and a discounted valuation relative to peers. Sundry Photography/iStock Editorial via Getty Images

Thesis Hewlett Packard Enterprise Company (HPE) draws most of its attention from AI server units and GPU pass-through economics, which is warranted given the company's history in compute. But most of this commentary is

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Key Takeaways HPE is benefiting from AI infrastructure demand and triple-digit server order growth.HPE entered Q3 with a $5.9 billion AI Systems backlog led by enterprise and sovereign customers.HPE is strengthening AI infrastructure with Juniper and record campus networking demand. Hewlett Packard Enterprise (HPE - Free Report) is benefiting from the modernization of traditional IT infrastructure and huge capex investment in artificial intelligence. HPE’s foray beyond traditional server architecture to accommodate compute, networking, storage, security, private cloud, virtualization, software for AI data centers and AI fabs is enabling it to monetize at a rapid pace.

Simultaneously, the demand for traditional servers, led by the end of the server technology cycle, has emerged as a major growth driver, with orders increasing by triple digits year over year. Enterprises are replacing aging infrastructure while also investing in servers for AI inferencing. These two tailwinds caused a multiplier effect, driving the second quarter of fiscal 2026 revenues to reach $10.7 billion.

Looking ahead, as AI moves into production, millions of enterprises will need infrastructure to run inference close to their proprietary data and applications. HPE is also benefiting directly from AI systems demand, entering the third quarter with $5.9 billion in AI Systems backlog, primarily from enterprise and sovereign customers. Juniper acquisition has also strengthened HPE in campus networking, data-center switching, routing and security.

HPE is uniquely positioned as it is one of the few companies that provide networking solutions as part of a wider AI infrastructure support. HPE’s self-driving networking capabilities, powered by agentic AI, further differentiate the portfolio.

Furthermore, HPE’s Campus and Branch orders reached record levels, Wi-Fi 7 sales increased more than sevenfold, data-center switching orders rose nearly 20%, and routing orders increased nearly 30% on a normalized basis in the second quarter of fiscal 2026. HPE is also benefiting from disruption in virtualization, with VM Essentials customer count increasing 43% during the first half of fiscal 2026.

How Competitors Fare Against HPE StockHPE competes with Super Micro Computer (SMCI - Free Report) and Dell Technologies (DELL - Free Report) in the AI infrastructure market. However, HPE’s ability to package compute, storage, networking and services into pre-configured solutions can reduce deployment complexity for enterprises and sovereign customers while giving it an edge over its competitors.

Super Micro Computer is on track to scale rack production capacity to more than 6,000 AI racks per month by the end of fiscal 2026, including 3,000 direct liquid cooling racks monthly.  SMCI is already shipping 150kW AI racks in volume and preparing 250kW and 500kW rack solutions to support future high-density AI training and inference workloads. Dell Technologies is a major supplier of servers and storage systems, with a broad customer base across enterprises and cloud providers. Its scale, established distribution and service offerings give it an edge in winning large contracts.

HPE’s Price Performance, Valuation and EstimatesHPE has gained 106.4% in the year-to-date period. However, the company has underperformed the Zacks Computer - Integrated Systems industry, which has returned 115.4% in the same time frame.

HPE YTD Performance Chart
Image Source: Zacks Investment Research

From a valuation standpoint, HPE trades at a forward price-to-sales ratio of 1.35, below the industry’s 6.08. The discounted valuation is also reflected by the Zacks Value Score of A.

HPE Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for HPE’s fiscal 2026 margin indicates year-over-year growth rate of 75.8%. Estimates have remained unchanged for the past 30 days.

Image Source: Zacks Investment Research

HPE currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

HOUSTON--(BUSINESS WIRE)--HPE (NYSE: HPE) today announced the publication of its 11th annual Living Progress Report, detailing the company’s Fiscal Year 2025 (FY25) progress against its Living Progress strategy. The report highlights how HPE enables customers to operate effectively as rising demand for compute-intensive workloads like AI place greater pressure on energy, resources, regulation, and trust.

Living Progress is HPE's business strategy to advance the way people live and work, by embedding responsible business practices across its value chain. The report shows how these efforts are translating into customer value, from minimizing energy use and infrastructure complexity to strengthening cyber resilience, data visibility, and trust.

“AI is transforming enterprises around the world at a pace unlike any technology before it,” said Antonio Neri, president and CEO of HPE. “The success of the next phase of AI adoption will depend on organizations’ ability to use creativity and focus to deploy AI securely, efficiently, and responsibly at scale. HPE is helping customers confidently build trusted technology that protects data, navigates complexity, and turns innovation into real outcomes, unlocking opportunities that were just not possible a few years ago.”

Advancing responsible technology

As AI adoption accelerates, customers need greater confidence that the technologies they deploy are secure, reliable, efficient, and governed responsibly. In FY25, HPE strengthened internal product and governance approaches and continued to mature its AI Governance model through internal risk assessments, an AI Governance and Enablement Hub, and targeted team member training, including on the company’s AI Ethical Principles.

HPE also advanced responsible solutions for customers, like HPE Private Cloud AI and HPE Private Cloud Enterprise air-gapped solutions, which support secure, disconnected deployments for sensitive workloads.

These capabilities are increasingly important as organizations deploy AI in highly regulated and security-sensitive environments. For instance, Siemens Energy is deploying a dedicated global platform through HPE’s GreenLake platform to support engineering-driven high-performance computing across sites in the United States and Germany. The platform is designed to accelerate AI-enabled simulation and digital twin workflows while helping Siemens Energy maintain oversight of data and systems under strict export control requirements. It demonstrates how AI can be deployed responsibly in critical industries such as energy, where demand for new infrastructure is rising rapidly.

Growing demand for energy efficient IT solutions

Demand for HPE’s IT sustainability-related offerings keeps increasing as customers continue to evaluate infrastructure decisions through the combined lens of performance, cost, energy use, and resilience. In FY25, $4.4 billion of total net revenue reflected customers' propensity to purchase products with sustainability attributes after learning about HPE's IT sustainability offerings and expertise.

Energy efficiency and resilience are key challenges facing customers today. HPE’s solutions deliver the performance customers need while aiming to minimize the energy and resources required to run their IT estates.

New generations of compute and storage, such as HPE ProLiant Compute Gen12 servers, can reduce data center footprints by up to 96% and use up to 87% less power compared to earlier generations.1 HPE Alletra Storage MP B10000 has also been shown to deliver up to a 45% reduction in energy consumption.2 And, across its networking portfolio, HPE’s AI-driven automation and analytics, including HPE Mist Networking Data Center Assurance, are optimizing operations with real-time power and carbon visibility to reduce unnecessary energy consumption.

In addition, HPE also expanded the use of direct liquid cooling (DLC) to support higher-density AI and high-performance computing workloads across its portfolio, including HPE ProLiant Compute and HPE Cray systems, helping minimize cooling-related carbon footprint and costs for customers by up to 86% annually.3 In high-performance computing, HPE had four systems ranked in the top 10 Green500 list of the world’s most energy-efficient supercomputers.

One of those systems is Isambard-AI, built by HPE for the University of Bristol. The UK’s most powerful AI supercomputer and ranked fourth most energy-efficient in the world as of 2026, Isambard-AI was delivered through an HPE modular data center that achieved an estimated 72% reduction in facility construction emissions compared with traditional construction methods. The system is helping UK researchers access advanced AI capabilities sooner, accelerating work across drug discovery, climate research, and industry.

In addition, HPE has built an end-to-end supply chain- from sourcing to manufacturing to delivery, installation, and servicing- that prioritizes energy and resource efficiency. And, through HPE Financial Services, customers can extend asset life, recover value, and modernize more sustainably.

Sustainability leadership recognitions

HPE continues to receive external recognition tied to its sustainability, ethics, and workforce efforts. HPE was recognized in Fortune’s 100 Best Companies to Work For list for the 5th year in a row. HPE also made CDP’s Climate A-List and received the EcoVadis Platinum Medal – putting it in the top 1% of companies with the highest sustainability performance. Reflecting its efforts to operate responsibly, HPE was named by Ethisphere as one of the World’s Most Ethical Companies for the 8th consecutive year and ranked #2 against the 45 largest global Information and Communications Technology (ICT) companies in the 2025 KnowTheChain ICT Benchmark.

To learn more and read the full FY25 Living Progress Report, visit: https://www.hpe.com/us/en/living-progress/report.html

About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

Key Takeaways SanDisk and Micron are benefiting from rising AI-driven demand for memory, flash storage and data centers.Digital Turbine is improving margins as mobile ad demand recovers and AI targeting lifts advertiser outcomes.HPE is gaining from AI server demand, GreenLake growth and enterprise spending on modern infrastructure. Despite the macroeconomic uncertainties, technology stocks have witnessed an impressive rally so far this year as investors continue pouring money into companies benefiting from artificial intelligence (AI), cloud computing and digital transformation. While many of the biggest gainers now trade at premium valuations, a handful of companies stand out for a different reason. Their stocks have rallied sharply, yet their earnings multiples remain well below the technology sector average.

A strong rally alone does not necessarily mean a stock has become expensive. If profits are growing faster than the share price, valuation can remain attractive. That is exactly what investors should look for when searching for the next leg of upside. Companies that combine accelerating earnings, industry tailwinds and reasonable valuations often outperform over longer periods.

SanDisk Corporation (SNDK - Free Report) , Micron Technology, Inc. (MU - Free Report) , Digital Turbine, Inc. (APPS - Free Report) and Hewlett Packard Enterprise Company (HPE - Free Report) are four such names. Their shares have climbed 707.1%, 243.1%, 111.2% and 102.1%, respectively, year to date (YTD) and have outperformed the Zacks Computer and Technology sector’s 17% gain.

YTD Price Return Performance
Image Source: Zacks Investment Research

Even after these eye-catching gains, all four stocks trade at forward 12-month price-to-earnings (P/E) multiples below the sector average of 24.8X, suggesting investors are still paying relatively modest prices for their future earnings.

Although these companies operate in different parts of the technology industry, they are all benefiting from powerful secular trends. SanDisk and Micron are riding on the recovery in memory demand driven by AI infrastructure and enterprise storage. Digital Turbine is capitalizing on improving digital advertising conditions and expanding mobile partnerships. Hewlett Packard Enterprise is benefiting from accelerating AI server demand and enterprise modernization.

If these growth drivers continue playing out, these stocks could have room to extend their remarkable rallies. These stocks have a favorable combination of a VGM Score of A or B and a Zacks Rank #1 (Strong Buy), offering solid investment opportunities.

SanDisk Rides on AI Storage BoomSanDisk has emerged as one of the biggest winners in the technology sector as demand for high-performance storage continues to accelerate. AI workloads, hyperscale cloud providers and enterprise data centers require increasingly larger amounts of flash storage, creating a favorable backdrop for the company.

The recovery in NAND pricing has also significantly improved SanDisk's earnings outlook after a prolonged industry downturn. At the same time, disciplined industry supply has helped balance the memory market, supporting healthier pricing trends. In the last reported financial results for the third quarter of fiscal 2026, its revenues jumped 251% year over year to $5.95 billion. The company reported non-GAAP earnings per share (EPS) of $23.41, a robust improvement from the year-ago quarter’s loss of 30 cents.

SanDisk continues introducing advanced SSDs and enterprise storage solutions designed for AI servers, cloud infrastructure and high-performance computing. As AI adoption expands across industries, storage demand is expected to grow alongside computing requirements. Despite the extraordinary stock rally, SanDisk's forward 12-month P/E valuation multiple of 9.85 remains well below the sector and many AI-focused technology companies, leaving room for further upside if earnings continue improving.

The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings indicates a year-over-year increase of 2,125% and 193%, respectively. The consensus mark for both periods’ earnings has been revised upward over the past seven days. Currently, SanDisk sports a Zacks Rank of 1 and has a VGM Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.

Micron Benefits From AI Memory DemandMicron remains one of the clearest beneficiaries of the AI infrastructure boom. Every AI server requires significantly more high-bandwidth memory (HBM) and advanced DRAM than traditional computing systems, creating a powerful demand driver for Micron's products.

The company has established itself as an important supplier of HBM used in AI accelerators, while demand for DRAM and NAND continues improving across cloud, enterprise and consumer markets. Capacity remains tight across several advanced memory products, allowing healthier pricing and supporting margin expansion. Micron is also benefiting from growing investments by hyperscale cloud companies that continue expanding AI data-center infrastructure.

In the most recently reported financial results for the third quarter of fiscal 2026, revenues soared 346% year over year to $41.46 billion, while non-GAAP EPS jumped to $25.11 from $1.91 reported in the year-ago quarter. Although Micron shares have more than tripled this year, its earnings growth outlook remains exceptionally strong, making its forward 12-month P/E valuation multiple of 6.90 appear attractive relative to the sector as well as many semiconductor peers.

The Zacks Consensus Estimate for fiscal 2026 and 2027 earnings indicates a year-over-year increase of 791% and 107%, respectively. The consensus mark for fiscal 2026 and 2027 earnings has been revised upward over the past 30 days. Currently, Micron sports a Zacks Rank of 1 and has a VGM Score of B.

Digital Turbine Executes a Strong TurnaroundDigital Turbine has staged a remarkable recovery by improving operational efficiency while benefiting from healthier mobile advertising demand. The company's platform helps mobile operators, smartphone manufacturers and app developers connect users with applications through on-device discovery and digital advertising.

As advertising budgets stabilize and mobile engagement remains strong, Digital Turbine is seeing improving business momentum. In the last reported financial results for the fourth quarter of fiscal 2026, Digital Turbine’s revenues rose 20% year over year to $142.5 million. Management has also taken meaningful steps to simplify operations, reduce expenses and improve margins. Those initiatives are translating into healthier profits. In the fourth quarter, non-GAAP EPS jumped 60% year over year to 16 cents.

Digital Turbine's AI-powered first-party data strategy has become a core pillar of its long-term growth. Management identified AI and data as the primary drivers of future double-digit growth, noting that improved AI targeting has already increased advertiser outcomes, with AGP pricing rising about 40% year over year in the fiscal fourth quarter of 2026, as advertisers paid more for superior returns.

Digital Turbine also continues expanding relationships with wireless carriers and original equipment manufacturers, broadening the reach of its platform. As advertisers increasingly focus on performance-based marketing, Digital Turbine's technology is well-positioned to benefit. Even after its impressive YTD gain, the stock trades at a forward 12-month P/E valuation multiple of 11.71, significantly below the sector’s average and many fast-growing technology peers.

The Zacks Consensus Estimate for fiscal 2027 earnings indicates a 50% year-over-year increase. The consensus mark for fiscal 2027 earnings has been revised upward over the past 60 days. Currently, Digital Turbine sports a Zacks Rank of 1 and has a VGM Score of A.

HPE Builds an AI Infrastructure BusinessHewlett Packard Enterprise has transformed itself into an increasingly important player in enterprise AI infrastructure. Demand for AI-optimized servers, networking equipment and storage solutions continues to rise as businesses modernize their technology environments.

Hewlett Packard Enterprise's AI systems business has been supported by robust enterprise and cloud customer spending. Its GreenLake platform is also gaining traction by allowing customers to consume computing infrastructure through a flexible, subscription-like model, creating more predictable recurring revenues. In the last reported financial results for the second quarter of fiscal 2026, its revenues soared 40% year over year to $10.7 billion, while non-GAAP EPS jumped 108% to 79 cents.

Hewlett Packard Enterprise is strengthening its competitive position through continued investments in networking, hybrid cloud and high-performance computing. As organizations deploy larger AI workloads, demand for integrated infrastructure solutions is expected to remain strong.

Despite more than doubling this year, HPE's forward 12-month P/E multiple of 12.65 remains below the broader technology sector average, reflecting a valuation that still appears attractive given its improving growth outlook.

The Zacks Consensus Estimate for fiscal 2026 earnings indicates a year-over-year increase of 76%. The consensus mark for fiscal 2026 earnings has remained unchanged over the past 60 days. Currently, Hewlett Packard Enterprise sports a Zacks Rank of 1 and has a VGM Score of B.

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What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.

Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.

The Style Scores are broken down into four categories:

Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.

Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.

Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.

#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.

But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.

That's where the Style Scores come in.

To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.

The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.

For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Hewlett Packard Enterprise (HPE - Free Report) Headquartered in Spring, TX, Hewlett Packard Enterprise Company was formed as a result of the split of Hewlett-Packard Company into two separate entities – one focusing on the enterprise-facing hardware and service business and the other focusing on the consumer-facing computer and printer segments.

HPE is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of B.

Additionally, the company could be a top pick for growth investors. HPE has a Growth Style Score of B, forecasting year-over-year earnings growth of 75.8% for the current fiscal year.

For fiscal 2026, eight analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $1.00 to $3.41 per share. HPE boasts an average earnings surprise of +16%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, HPE should be on investors' short list.

Image: Bigstock

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Key Takeaways Hewlett-Packard Enterprise reported record AI systems orders, boosting cumulative AI bookings and backlog. Alphabet increased its 2026 capital expenditure guidance to expand AI servers, data centers and networking. Amazon's AWS AI momentum and major Trainium commitments support long-term AI infrastructure growth. Artificial intelligence (AI) infrastructure spending is accelerating at an unprecedented pace, creating long-term opportunities across cloud computing, data centers and AI hardware. Rapid advancements in large language models, generative AI, agentic AI, multimodal learning and high-performance computing enabled by innovations in GPUs and Tensor Processing Units (TPUs) are driving breakthroughs across healthcare, finance, robotics, cybersecurity and e-commerce industries.

The rapid deployment of AI technology and huge spending on its development efforts offer significant growth opportunities for Amazon (AMZN - Free Report) , Alphabet (GOOGL - Free Report) , and Hewlett-Packard Enterprise (HPE - Free Report) . Amazon, Alphabet, along with Microsoft and Meta Platforms, are expected to spend around $700 billion in capital expenditures in 2026, with a substantial portion directed toward building AI-ready data centers, expanding cloud regions and deploying GPU clusters.

Before discussing the stocks in detail, let’s dig deeper into the trends.

AI Infrastructure Attracting Significant SpendingData centers have become the backbone of the AI ecosystem, providing the computational power, high-speed networking and large-scale data storage required to train and deploy advanced AI models. Unlike traditional enterprise data centers, AI data centers are built around high-density GPU clusters, ultra-fast networking, advanced cooling systems and scalable power infrastructure to support compute-intensive workloads. Per an IDC report, global AI infrastructure spending reached a record $318 billion in 2025, more than doubling year over year, and is projected to exceed $1 trillion by 2029, driven by hyperscaler investments and the growing adoption of sovereign AI initiatives.

From conversational chatbots and medical diagnostics to fraud prevention and autonomous systems, AI has become a core enabler of organizational agility, while also driving meaningful gains in productivity and operational efficiency.  In 2026, the worldwide AI spending is expected to reach $2.59 trillion, representing 47% year-over-year growth. This rapid growth is expected to have been driven primarily by technology vendors and hyperscale cloud providers that are expanding AI infrastructure to meet rising demand for generative AI and agentic AI applications.

AI infrastructure spending extends beyond AI-optimized servers to encompass GPUs and custom AI accelerators, PCIe-enabled platforms, advanced chip-to-chip interconnects, high-speed networking technologies, high-bandwidth memory (HBM), optical connectivity and AI storage solutions.

According to Gartner, AI infrastructure, including AI-optimized cloud services, servers, networking, and semiconductors, is forecasted to account for more than 45% of total AI spending in 2026, with AI-optimized servers emerging as the largest spending category over the next five years.

Our PicksHewlett-Packard Enterprise is benefiting from the modernization of traditional IT infrastructure and huge capex investment in AI. HPE is driving rapid growth by expanding beyond traditional servers into AI-optimized compute, networking, storage, security, private cloud, virtualization and software for AI data centers.

The company’s focus on enterprise and sovereign AI, combined with the Juniper Networks integration, strengthens HPE’s competitive position. In the second quarter of fiscal 2026, HPE reported record AI systems orders of $1.8 billion, lifting cumulative AI bookings to $16.4 billion and backlog to $5.9 billion.

This Zacks Rank #1 (Strong Buy) company expects continued growth from record order pipeline, sustained AI server demand, expanding AI networking deployments and rising on-premises AI adoption. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for fiscal 2026 earnings is pegged at $3.41 per share, which has been unchanged over the past 30 days. This represents 75.77% year-over-year growth.

Alphabet is benefiting from surging AI infrastructure demand, strengthening growth across Google Cloud and Search. GOOGL’s full-stack AI strategy, spanning custom TPUs, Axion CPUs, NVIDIA GPUs and advanced Gemini models, provides scalable AI infrastructure for enterprises and consumers.

To support rising demand, this Zacks Rank #2 (Buy) company raised 2026 capital expenditure guidance to $180-190 billion, with a significant portion allocated to servers, data centers and networking equipment to meet unprecedented internal and external demand for AI compute resources. Alphabet expects 2027 capital expenditure to increase significantly as it continues to scale its infrastructure to capture the expanding AI opportunity.

The consensus mark for 2026 earnings is pegged at $14.32 per share, which has increased by a couple of cents over the past 30 days. This represents 32.47% year-over-year growth.

Another Zacks Rank #2 company, Amazon, is benefiting from massive capital expenditures on AI infrastructure through significant investments in custom silicon like Trainium and Graviton chips, data centers and AI services. These have positioned Amazon’s cloud computing platform, Amazon Web Services (“AWS”), as a leader in the rapidly growing AI market.

With AWS’s AI revenue run rates exceeding $15 billion and strong customer commitments, including more than $225 billion in revenue commitments for Trainium, these CapEx investments are expected to yield compelling operating margins and long-term returns, signaling further upside as AI adoption accelerates across industries.

The consensus mark for 2026 earnings is pegged at $8.86 per share, which has increased by a penny over the past 30 days. This represents 23.57% year-over-year growth.

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On a recent episode of Barron’s Streetwise, host Jack Hough answered a listener named William who was nervous about how much money he had made in AI-adjacent names like Dell (NYSE:DELL | DELL Price Prediction) and HPE (NYSE:HPE). Hough’s answer had a number in it that should probably make everyone else nervous too.

“You can look at the S&P 500 right now and you can say, okay, it trades at 22 times projected 2026 earnings. That’s kind of expensive. But it trades at 32 times projected free cash flow. That’s extraordinarily expensive.” The index is up 9.22% year to date, and the gap between what companies are earning on paper and what they are actually converting into cash is now the most important argument on Wall Street.

The accounting quirk hiding inside the AI boom Hough’s explanation is worth understanding because it is not complicated. When a hyperscaler spends billions on GPUs and data centers, that capex gets depreciated over years, so only a sliver hits the income statement each quarter. Meanwhile, the companies selling picks and shovels (servers, switches, generators) book the corresponding revenue immediately. So the whole ecosystem’s reported earnings look terrific, while the cash actually leaving the building tells a different story. Hough cited Google’s projected 2025 profit of $173 billion against free cash flow of only $19 billion, and Meta’s $84 billion in earnings against roughly $400 million in cash burn as the shape of the problem.

Those specific figures are directional, and the actual reports rhyme with them. Alphabet (NASDAQ:GOOGL) posted FY2025 free cash flow of $73.3 billion, up just 0.7% year over year, even as capex jumped 74% to $91.4 billion. In Q1 2026 it got worse. FCF collapsed 46.63% to $10.12 billion while capex more than doubled to $35.67 billion. Sundar Pichai then guided 2026 capex to $175 to $185 billion, which is a number that used to be a country’s defense budget. You can read the whole thing in the Q1 2026 8-K.

Meta is running the same experiment Meta Platforms (NASDAQ:META) reported full-year 2025 free cash flow of $43.6 billion, down 19.39%, even though revenue grew 22.17%. Then management raised 2026 capex guidance to $125 to $145 billion, from a prior range that was already historic.

The Q1 EPS beat of 56.79% looked enormous, but $3.13 of that came from an $8.03 billion tax benefit tied to R&D treatment. Meta shares are down 8.6% year to date, one of the few big names where the market has actually pushed back on the story. Alphabet, meanwhile, is up 15% YTD.

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The hard-hat side has already run Hough’s tactical suggestion was “less big tech, more hard hat and value stocks.” The problem is the market got there first. Dell Technologies reported quarterly revenue growth of 87.5% with AI-optimized server revenue of $16.13 billion, and the stock is up 217% year to date.

Hewlett Packard Enterprise is up 77% YTD on the Juniper networking integration and AI servers. Even Caterpillar (NYSE:CAT), which nobody would confuse with a growth stock, is up 62% YTD because its Power Generation segment rose 41% feeding data center reciprocating engines. Its trailing P/E is now 48x, which is not a value stock multiple.

What to actually do about it Hough cited a Bank of America mid-year note that kept its S&P 500 target at 7,100, representing roughly a 5% decline from publication, alongside rising odds of a “bear flattener” in rates, historically the second worst phase for stocks in 12-month returns going back to 1976.

For most people, though, his advice was less exciting. “My recommendation is to hurry up and do nothing” for long-term investors. The 32x cash flow multiple is a reminder that when reported earnings are being flattered by the capex of others, the margin for disappointment is thinner than the P/E ratio suggests.

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Contact [email protected] for any questions or corrections.

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.

The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.

Zacks Premium includes access to the Zacks Style Scores as well.

What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.

Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.

The Style Scores are broken down into four categories:

Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.

Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.

Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

VGM ScoreIf you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.

How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.94% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.

That's where the Style Scores come in.

To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.

As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.

A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Hewlett Packard Enterprise (HPE - Free Report) Headquartered in Spring, TX, Hewlett Packard Enterprise Company was formed as a result of the split of Hewlett-Packard Company into two separate entities – one focusing on the enterprise-facing hardware and service business and the other focusing on the consumer-facing computer and printer segments.

HPE is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of A.

It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 12.1; value investors should take notice.

For fiscal 2026, eight analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $1.00 to $3.41 per share. HPE boasts an average earnings surprise of +16%.

With a solid Zacks Rank and top-tier Value and VGM Style Scores, HPE should be on investors' short list.

It has been about a month since the last earnings report for Hewlett Packard Enterprise (HPE - Free Report) . Shares have lost about 19.7% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Hewlett Packard Enterprise due for a breakout? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Hewlett Packard Enterprise Company before we dive into how investors and analysts have reacted as of late.

HPE Q2 Earnings Surpass Expectations, Revenues Rise Y/YHewlett Packard Enterprise reported better-than-expected results for second-quarter fiscal 2026.  HPE’s non-GAAP earnings of 79 cents per share beat the Zacks Consensus Estimate by 46.3% and increased 107.9% year over year.

HPE posted revenues of $10.7 billion for the quarter, beating the Zacks Consensus Estimate by 8.7%. The company’s revenues increased 40.0% year over year.

HPE’s quarterly performance was supported by strong demand across the portfolio, with orders more than doubling year over year and driving a record backlog. Management also highlighted progress in Juniper integration and the Catalyst initiative, which remained ahead of schedule.

HPE’s Segment-Wise PerformanceHewlett Packard’s Networking segment generated $2.7 billion in revenues in the second quarter of fiscal 2026, up 148.2% year over year. The segment’s operating profit margin was 21.6%, down from 25.0% in the year-ago quarter.

Within Networking, Campus & Branch revenues were $1.3 billion, up 50.2% year over year. Data Center Networking revenues were $320 million, up 233.3%, and Security revenues were $273 million, up 155.1%. Routing revenues were $775 million compared with $1 million in the year-ago quarter.

The Cloud & AI segment reported $7.7 billion in revenues, up 22.9% year over year, with an operating profit margin of 12.4%, up from 6.6% in the prior-year period.

Within Cloud & AI, Server revenues were $5.5 billion, up 32.7% year over year. Storage revenues totaled $1.2 billion, up 2.4%, while Financial Services contributed $0.9 billion, up 5.6% year over year.

HPE’s Corporate Investments and Other revenues came in at $281 million, up 3.3% from the prior-year period.

HPE’s Operating ResultsHewlett Packard’s non-GAAP gross profit for the second quarter of fiscal 2026 was $3.94 billion compared with $2.24 billion in the year-ago quarter, while the non-GAAP gross margin expanded to 36.9%, up 750 basis points year over year.

The company’s non-GAAP operating profit was $1.4 billion compared with $613 million in the year-ago quarter. The non-GAAP operating margin improved to 13.3%, up 530 basis points from the year-ago quarter.

HPE’s Balance Sheet and Cash FlowHewlett Packard ended the second quarter with $5.29 billion in cash and cash equivalents compared with $4.84 billion at the end of the previous quarter.

In the second quarter, HPE generated $1.4 billion in cash from operating activities and produced $915 million in free cash flow. The company returned $343 million through dividends and share repurchases during the quarter.

HPE Updates FY26 GuidanceHewlett Packard raised its outlook following the strong quarter and improved second-half visibility. For the third quarter of fiscal 2026, HPE expects revenues in the range of $11.5-$12.1 billion.

It anticipates non-GAAP earnings per share of 88-93 cents.

For fiscal 2026, HPE raised its revenue growth outlook to 29-33% and expects non-GAAP earnings per share of $3.35-$3.45.

The company also lifted its free cash flow outlook and now expects free cash flow to be at least $3.5 billion. Separately, HPE introduced a fiscal 2027 framework calling for revenue growth of 8-12% and free cash flow of at least $4.5 billion.

How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 71.61% due to these changes.

VGM ScoresAt this time, Hewlett Packard Enterprise has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock has a grade of B on the value side, putting it in the second quintile for value investors.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Hewlett Packard Enterprise has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

Investors with an interest in Computer - Integrated Systems stocks have likely encountered both Hewlett Packard Enterprise (HPE - Free Report) and Advanced Micro Devices (AMD - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Hewlett Packard Enterprise is sporting a Zacks Rank of #1 (Strong Buy), while Advanced Micro Devices has a Zacks Rank of #3 (Hold). This means that HPE's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

HPE currently has a forward P/E ratio of 12.82, while AMD has a forward P/E of 72.68. We also note that HPE has a PEG ratio of 0.40. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AMD currently has a PEG ratio of 1.32.

Another notable valuation metric for HPE is its P/B ratio of 2.28. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AMD has a P/B of 13.19.

Based on these metrics and many more, HPE holds a Value grade of B, while AMD has a Value grade of F.

HPE sticks out from AMD in both our Zacks Rank and Style Scores models, so value investors will likely feel that HPE is the better option right now.

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The Award Recognized Exemplary Quality, Cost, and Delivery Performance from U.S. Manufacturing that Powers the Next Generation of AI-Cluster Computing

TEMPE, Ariz.--(BUSINESS WIRE)--Benchmark Electronics, Inc. (NYSE: BHE) today announced it has been named HPE’s Manufacturing Partner of the Year for 2026, recognizing Benchmark’s exemplary quality, cost, delivery performance, and customer service in helping HPE rapidly scale next-generation AI infrastructure.

The award was presented during HPE’s Partner Summit in Houston, Texas, which brought together HPE’s largest global suppliers to align on HPE’s priorities and growth plans for 2026 and beyond. Benchmark was selected from among leading manufacturing competitors.

Recognized for Supporting HPE’s Most Important AI Programs

What distinguished Benchmark was not only its strong, continued performance in quality, cost, and delivery, but also its critical role in helping HPE ramp U.S. production of some of its highest-profile AI platforms. This includes blade-level assembly, testing, and validation for high-power, liquid-cooled server blades, further expanding Benchmark’s role as a key global manufacturing partner to HPE.

“The Manufacturing Partner of the Year award is a tremendous honor and reflects the trust HPE has placed in Benchmark to help scale next‑generation AI infrastructure,” said David Moezidis, President and CEO of Benchmark. “This recognition highlights the exceptional work of our team and underscores Benchmark’s ability to deliver the quality, scale, and responsiveness required to support the world’s most advanced computing platforms.”

Benchmark’s programs have significant visibility within HPE and are central to the company’s strategy for supporting the next generation of AI computing. The Company’s ability to execute these complex, high-profile programs with experienced U.S.-based engineering and manufacturing helped set it apart from other suppliers and contributed directly to the award. Benchmark credited this achievement to its Winona, Minnesota team, along with support from its global network, demonstrating the capabilities of our cross-functional and production teams that support HPE programs every day.

For more information on Benchmark's capabilities and role in AI-driven computing, visit www.bench.com.

About Benchmark Electronics, Inc.

Benchmark provides comprehensive solutions across the entire product lifecycle by leading through its innovative technology and engineering design services, leveraging its optimized global supply chain, and delivering world-class manufacturing services in the following industries: commercial aerospace, defense, advanced computing, next-generation communications, industrial, medical, and semiconductor capital equipment. Benchmark operates in eight countries and its common shares trade on the New York Stock Exchange under the symbol BHE.

About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

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Vultr leverages HPE and NVIDIA to support a global AI cloud platform designed to help customers move faster in the AI era

LAS VEGAS--(BUSINESS WIRE)--HPE Discover Las Vegas 2026--HPE (NYSE: HPE) today announced Vultr, the world’s largest privately held hyperscaler, has selected HPE and NVIDIA for large-scale AI datacenter deployments designed to support rapidly growing enterprise demand for private cloud and AI workloads.

Vultr has selected the NVIDIA GB300 NVL72 by HPE connected with NVIDIA Spectrum-X Ethernet networking, part of the NVIDIA AI Computing by HPE portfolio, to power its next-generation AI infrastructure environments designed for enterprise-scale AI workloads. These deployments combine HPE’s AI factory capabilities with NVIDIA accelerated computing, networking, and software to deliver a scalable, production-ready AI platform optimized for high-performance model training and inference.

The deployments will support Vultr’s next phase of global AI infrastructure expansion and reinforce the company’s strategy to advance its cloud provider strategy. As an expansion of Vultr’s broader cloud offerings, future facilities will incorporate rack-scale systems powered by NVIDIA accelerated computing and high-performance networking technologies, in addition to HPE’s unique liquid cooling technology, services, and expertise.

“HPE, Vultr, and NVIDIA are building AI infrastructure designed for the future of AI and the agentic enterprise,” said Antonio Neri, president and CEO, HPE. “Vultr represents a new generation of AI cloud providers, and the company’s selection of HPE validates the importance of AI data center architectures designed to support the next wave of global AI growth.”

Enterprises, cloud providers and other organizations continue to turn to HPE as a key provider of AI infrastructure as they invest in large-scale GPU environments. HPE is delivering AI factory architecture with NVIDIA for Vultr, including compute, networking, and operational platforms designed to support hyperscale-class AI clusters. Drawing on decades of experience building and operating some of the world’s largest supercomputing environments, HPE will provide the specialized AI services, deployment expertise, and lifecycle support required to design, integrate, optimize, and sustain complex enterprise-scale AI projects.

"As a powerful extension of our global cloud infrastructure platform, Vultr is deploying dedicated AI infrastructure focused on GPU architecture and AI inference to accelerate customer innovation while maintaining cost efficiency,” said J.J. Kardwell, CEO, Vultr. “AI infrastructure remains significantly underbuilt globally, and enterprises increasingly require high-performance AI compute integrated seamlessly at the edge. We are expanding our capabilities with a focus on supporting enterprise demand for decentralized, latency-sensitive workloads across Vultr’s extensive global network.”

Vultr continues to make large-scale infrastructure investments that require high-performance AI systems, networking, and data center expertise to support the rapid expansion of its GPU-as-a-service capabilities that will power enterprise AI and private cloud deployments. New developments will include a large-scale NVIDIA Spectrum-X™ Ethernet networking featuring 400GbE and 800GbE interconnects, optical transceivers, and NVIDIA Spectrum-X Ethernet switches and SuperNICs, engineered to support dense, large-scale AI clusters and GPU rack-scale connectivity across new AI data center environments.

Recent HPE News:

HPE introduces CPU server with NVIDIA-Vera CPU, purpose-built for Agentic AI HPE transforms distributed AI factories into intelligent AI grid powered by NVIDIA HPE accelerates secure, scalable production-ready AI through new innovations with NVIDIA About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

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HPE Morpheus Software provides virtualization for the agentic enterprise with new agentic orchestration and unified control plane for AI and traditional enterprise workloadsGreenLake Intelligence advances agentic AIOps for hybrid IT with new capabilities to observe and govern AI factories, agents, and workloadsHPE is partnering with ServiceNow to turn real-time, full-stack insights into autonomous, AI-driven service delivery with GreenLake IntelligenceCitrix and HPE to deepen strategic collaboration with Citrix Desktop-as-a-Service planned for GreenLake using HPE Morpheus SoftwareHPE Private Cloud extends standardized, air-gapped operations from edge to datacenter for regulated and sovereign environments LAS VEGAS--(BUSINESS WIRE)--HPE Discover Las Vegas 2026 – HPE (NYSE: HPE) today announced expanded capabilities across GreenLake to deliver unified operations for the agentic enterprise through innovations across agentic AIOps, private cloud, and software for AI infrastructure. Through GreenLake, HPE provides customers with a unified operating model that addresses rising virtualization costs, modernizes for emerging AI workloads, and simplifies operational complexity.

“As enterprises scale AI, they need a simpler way to govern AI infrastructure and modernize operations across hybrid environments without fragmentation or unpredictable costs,” said Fidelma Russo, EVP, President and GM, Hybrid Cloud and CTO at HPE. “The latest advancements in GreenLake give enterprises a proven, unified path for agentic hybrid operations today and a foundation for future autonomous operations.”

GreenLake delivers agentic AI-powered operating experience across AI factories and hybrid environments

GreenLake Intelligence provides an agentic AI framework for hybrid cloud and AI operations. A centralized agent registry, intelligent planning and orchestration capabilities, and secure governance controls help organizations manage and coordinate AI agents across infrastructure, applications, and operational workflows.

The HPE OpsRamp Operations Copilot provides new observability for agents and LLMs, enabling organizations to monitor AI utilization, govern token-based consumption, and understand operational costs across agents, multi-vendor AI factories, and workloads. The copilot proactively identifies issues through full-stack telemetry correlation and agentic root-cause analysis. HPE is partnering with ServiceNow to turn real-time, full-stack insights into autonomous, AI-driven service delivery. By integrating GreenLake Intelligence—through the OpsRamp Operations Copilot—with ServiceNow’s autonomous AI workforce, HPE and ServiceNow are creating a single source of truth for agentic IT operations from full-stack observability of AI infrastructure to end-to-end autonomous service delivery. HPE Morpheus Software offers an enterprise-grade, full-featured alternative to existing virtualization platforms and now combines self-service provisioning with integrated observability and operations capabilities for hybrid cloud environments. Enterprises can provision and manage VM and container workloads, correlate telemetry with AI-powered insights, and operate with confidence, all under a single per-socket subscription. The latest Morpheus capabilities include:

The new HPE Morpheus Orchestration Copilot, part of GreenLake Intelligence, eliminates the costly, error-prone nature of multi-step, multi-tool manual workflows for provisioning and orchestration of infrastructure and workloads. Enterprises can leverage their preferred AI tools with built-in governance and security guardrails through a bring-your-own-model architecture. The copilot acts, automating and orchestrating infrastructure and workload provisioning end-to-end, while enabling resource-constrained teams to move faster with confidence. New HPE Morpheus Central, delivered through GreenLake, provides centralized visibility, governance, and management across multiple HPE Morpheus deployments. Software-defined networking (SDN), now generally available for HPE Morpheus, enables zero-trust security, multitenancy, consistent policy enforcement, and VXLAN overlay networking, while reducing provisioning time by up to 60%. Intent-based, closed-loop network automation is available in HPE Morpheus through HPE Juniper Apstra integration, continuously validating live network state, eliminating configuration drift, and automating policy enforcement at scale. Stretched cluster capabilities, also generally available, enable metro-grade resilience across two active sites with synchronous replication and automated failover. HPE Zerto Software enables live workload migration from VMware environments to HPE virtual machines with continuous data protection. Citrix and HPE to deepen strategic collaboration on private cloud and virtualization solutions

Citrix and HPE are planning to expand their strategic collaboration on private cloud and virtualization solutions, with an initial focus on delivering Citrix Desktop-as-a-Service (DaaS) on GreenLake for customers seeking on-premises and sovereign deployments. The companies also plan for Citrix DaaS and Citrix Virtual Apps and Desktops to be integrated with HPE Morpheus Software—VM Essentials as a key virtualization platform and for HPE CloudOps to provide unified orchestration, automation, and observability across GreenLake hybrid deployments.

HPE de-risks virtualization migrations and enables service providers to build private cloud services

Announced at HPE Partner Growth Summit 2026, HPE is introducing new programs for customers and service providers.

A new platform migration program for virtualization enables partners to help customers reduce financial risk and avoid double-paying during migrations. New HPE Morpheus Software—VM Essentials customers can receive up to one free year of licenses for VM Essentials, a year of HPE Zerto for $1 to support non-disruptive migration to HPE virtual machines, and 0% interest on software through HPE Financial Services. HPE CloudOps Software for cloud service providers helps cloud service providers (CSPs) build, operate, and monetize differentiated private cloud services with multi-tenancy, self-service, SDN, policy-based governance, and cost management. The HPE Cloud Commit program further enhances value with preferential pricing and services tied to committed spend. HPE Private Cloud extends unified and air-gapped operations from edge to datacenter

From edge to datacenter and across VMs to containers, the HPE Private Cloud portfolio now delivers a single control plane built on HPE Morpheus and standardized, integrated air-gapped deployment for disconnected, regulated, or sovereign environments.

HPE Private Cloud PC3000 is updated to support air-gapped deployment across edge and core deployments. New VMware vSphere 9 validation helps HPE Private Cloud PC3000 customers remain current without requiring a platform transition, while HPE Morpheus delivers unified management of HPE virtual machines (VMs) and containers on a single platform. HPE Private Cloud PC7000 helps organizations modernize datacenter operations across managed, large-scale, and mission-critical environments.

By incorporating the latest updates across HPE Morpheus, HPE Private Cloud PC7000 offers infrastructure-as-code with Terraform support, automated private cloud operations, and validation for VMware vSphere 9. The air-gapped deployment of HPE Private Cloud PC7000 now includes readiness for Department of Defense Impact Level 4 (IL4) certification. IL4 provides a robust security foundation that enables the air-gapped deployment to meet the requirements for secure design and development, configuration hardening, and vulnerability management and aligns with leading national and international security compliance standards. To help enterprises navigate the unpredictable economics of the current commodity pricing environment, GreenLake Flex Solutions offers flexible pay-as-you-go consumption, and new capabilities simplify hybrid infrastructure operations. A new integrated interface brings together hybrid observability, IT sustainability insights, and consumption analytics, giving GreenLake Flex customers a single place to access all tools and capabilities. Customers can now buy leading third-party software solutions from the GreenLake ecosystem directly through the GreenLake Marketplace.

Availability

HPE OpsRamp Operations Copilot within GreenLake Intelligence is available today. GreenLake Intelligence and ServiceNow integrations will be rolled out across 2026 and 2027. The latest updates to HPE Morpheus Software are rolling out across Q2 and Q3 2026. HPE CloudOps Software for cloud service providers is available today. HPE Private Cloud air-gapped for PC3000 and PC7000 will be available in Q3 2026. Additional new capabilities within HPE Private Cloud will be generally available in Q3 2026. GreenLake Marketplace with direct transactability between customers and ISVs is available today. Additional Resources

Press Release: HPE fuels partner growth with new incentives, partner-led offers, and unified program Blog: Introducing HPE CloudOps Software for Cloud Service Providers Blog: GreenLake Marketplace launches end-to-end commerce capabilities Blog: Unleash AI pushes enterprise AI beyond the pilot phase ServiceNow, the ServiceNow logo, and other ServiceNow marks are trademarks and/or registered trademarks of ServiceNow, Inc. in the United States and/or other countries.

About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

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Hewlett Packard Enterprise is a pure-play AI infrastructure leader, benefiting from a structural shift as corporate demand for turnkey server solutions surges. HPE's Q2 2026 revenue soared 40% year-over-year to $10.68B, with net profit rebounding to $624M, confirming the unleashed, previously delayed demand. The easing of supply chain bottlenecks in 2026 enabled HPE to rapidly monetize pent-up corporate AI demand, driving strong profitability and margin restoration.

Veeam brings Data and AI Trust capabilities to HPE Private Cloud offerings, delivering validated designs for HPE Private Cloud AI, partner-ready packaging for modern virtualization, and expanded collaboration through Veeam’s new Data and AI Trust Maturity Model

LAS VEGAS--(BUSINESS WIRE)--HPE Discover--Veeam® Software, the Data and AI Trust Company, today at HPE Discover announced expanded joint innovation to help organizations modernize and scale private cloud – from AI-ready infrastructure and validated designs to repeatable, partner-ready packaging for faster deployments. Building on the companies’ alliance and the Data Resilience by Design – a framework that makes resilience the foundation for secure, governed and recoverable data – Veeam and HPE are advancing new capabilities focused on accelerating private cloud adoption with simpler architectures, safer AI data pipelines, and faster time-to-value.

“AI will transform the enterprise, but only if leaders can trust the data that powers it. That trust starts with resilience – knowing data is protected, recoverable, and governed end-to-end," said John Jester, Chief Revenue Officer (CRO) at Veeam.

Share “Private cloud is evolving fast as customers want cloud agility with greater control, stronger governance, and the ability to operationalize AI closer to their data,” said John Jester, Chief Revenue Officer (CRO) at Veeam. “AI will transform the enterprise, but only if leaders can trust the data that powers it. That trust starts with resilience – knowing data is protected, recoverable, and governed end-to-end. Together with HPE, Veeam is bringing that trust layer to private clouds with validated designs and partner-ready solutions to help customers protect and govern their data, reduce risk across AI pipelines, and accelerate business outcomes without sacrificing performance or agility.”

HPE Private Cloud AI: New Validated Designs for AI-Ready Private Cloud Deployments

Veeam and HPE will release new validated designs for HPE Private Cloud AI to help customers deploy secure, AI-ready private environments. HPE Private Cloud AI is a turnkey AI factory co-engineered with NVIDIA as part of the NVIDIA AI Computing by HPE portfolio and is designed to deliver a complete, secure AI workbench with a unified data lakehouse, deployable models, and agentic use cases. With data sovereignty requirements expanding globally and AI ethics expectations moving from policy statements to operational mandates, organizations need practical architectures that protect data, strengthen recoverability, and improve confidence in AI data handling.

“Enterprises are choosing private cloud to meet performance and sovereignty requirements while putting the right guardrails in place for AI,” said Patrick Osborne, SVP of technology acceleration for hybrid cloud, HPE. “With these new validated designs for HPE Private Cloud AI and our expanded collaboration with Veeam, we’re giving customers a ready-to-run path to deploy AI closer to their data, combining proven infrastructure with stronger governance and greater confidence in how AI data is prepared, handled, and protected as they move from pilots to production.”

The validated designs will include:

Veeam Data Platform and Veeam Kasten, both part of the Veeam DataAI™ Command Platform, supporting operational continuity for virtualized and Kubernetes-based workloads that power AI initiatives Safe data ingestion to help organizations prepare and ingest data for AI use cases with stronger controls and confidence in data handling complementing HPE AI Essentials that manages the model development and deployment lifecycle These validated designs reduce deployment complexity and help customers move from AI pilots to production faster, while maintaining operational safeguards appropriate for enterprise private cloud.

Resilient HPE Private Cloud: Repeatable, Partner-Ready Private Cloud

In support of HPE’s recent unified private cloud announcement, HPE and Veeam are enabling partners with sizing tools and smart templates to more easily position and deliver resilient private cloud deployments using HPE Private Cloud PC3000 with HPE Morpheus Software VM Essentials. The goal is to help partners standardize designs, streamline scoping, and accelerate delivery so customers can expand private cloud footprints with greater predictability and reduced operational overhead with Veeam and HPE Private Cloud.

To further simplify adoption and modernization, Veeam is also providing a practical migration guide for moving vSphere VMs to virtual machines on HPE Morpheus. HPE Private Cloud using the Veeam Data Platform helps customers and partners plan and execute transitions as they evolve their private cloud strategies, while maintaining the resilience and recoverability required for business-critical workloads.

Expanding the Private Cloud Roadmap to Include Security, Governance, and AI Trust

As AI shifts from assistive tools to autonomous agents acting on enterprise data at machine speed, organizations face a growing gap between confidence in AI readiness and the ability to produce audit-ready evidence that data pipelines, access controls, governance, and recovery can stand up to board, audit, and regulatory scrutiny. AI confidence is high, but confidence alone does not scale, which is why Veeam and HPE are focused on helping customers operationalize AI trust, not just aspire to it.

The Veeam DataAI Command Platform is the industry's first unified data and AI trust infrastructure for the agentic era. The platform unifies key domains, including DataAI Security, DataAI Governance, DataAI Compliance, DataAI Privacy, and DataAI Resilience, powered by the DataAI Command Graph – Veeam's intelligence layer powering the entire platform which includes hundreds of connectors across every cloud, SaaS application, and on-premises environment.

Building on Data Resilience by Design, the companies are expanding their collaboration to connect resilience outcomes – protection, recoverability, and clean restore – with the governance and controls required for trusted AI. To help close this execution gap, HPE Services will serve as a pilot partner for Veeam’s new Data and AI Trust Maturity Model, a research-informed and customer-validated framework that gives leaders a clear, objective way to assess where they truly stand, benchmark progress, and prioritize the capabilities required to strengthen trust readiness across four core pillars: Understood, Secured, Resilient, and Unleashed.

Through this collaboration, Veeam and HPE will help customers move from AI experimentation to trusted execution – improving visibility and governance, reducing risk across AI data pipelines, and ensuring the ability to recover clean, trusted data when it matters most.

Veeam at HPE Discover 2026

Veeam (Booth #2039) is an exclusive sponsor of the HPE Virtualization and CloudOps Hub at HPE Discover 2026, underscoring the companies’ continued commitment to advancing private cloud innovation for modern virtualized workloads and AI-ready environments.

For more information on the Veeam and HPE alliance visit https://www.veeam.com/solutions/alliance-partner/hpe.html or www.veeam.com.

About Veeam Software

Veeam® Software is the Data and AI Trust Company, specializing in helping organizations ensure their data and AI are fully understood, secured, and resilient to enable the acceleration of safe AI at scale. As the market leader in both data resilience and data security posture management, Veeam is built for the convergence of identity, data, security, and AI risk.

Veeam delivers deep contextual intelligence across every data asset, identity, and AI model. The company governs access for both humans and AI agents, automates privacy, compliance, and remediation processes, and protects and recovers organizations from modern threats – including ransomware, disasters, AI errors, and ensuring the restoration of clean, trusted data. Veeam empowers organizations to move beyond simply protecting data, enabling them to activate and unlock its full potential.

Headquartered in Seattle with offices in more than 30 countries, Veeam protects over 550,000 customers worldwide, including 82% of the Fortune 500, who trust Veeam to keep their businesses running. Learn more at www.veeam.com or follow Veeam on LinkedIn @veeam-software and X @veeam.

Spending on artificial intelligence (AI) is not slowing down. Companies that are addressing the growing demand for computing hardware and software are reporting strong revenue and earnings.

Three companies that recently delivered strong earnings results -- Hewlett Packard Enterprise (HPE +0.26%), Micron Technology (MU 0.77%), and Palantir Technologies (PLTR 0.59%) -- all exceeded Wall Street expectations. Let's take a look at what is driving their growth and whether the momentum makes them solid buys for a long-term investor.

Image source: Getty Images.

Hewlett Packard Enterprise (HPE) Investment is pouring into AI-optimized data centers to support mission-critical workloads across training and inferencing. These data centers need fast networking equipment to connect and transmit data between thousands of chips. This is opening up a new growth avenue for HPE, one of the leaders in enterprise services and technology infrastructure.

Its latest quarter showed accelerating demand. Revenue grew 40% year over year, up from 18% in the previous quarter. Strong revenue drove a massive earnings beat, with adjusted earnings per share of $0.79 -- above analyst estimates of $0.53. After orders more than doubled, management now expects to hit its 2028 earnings target two years early.

HPE's recent acquisition of Juniper Networks strengthens its competitive position. Juniper's advanced networking and AI-driven automation capabilities will complement HPE's servers and storage business, creating a full-stack AI infrastructure offering. Management indicated that cross-selling products is already leading to larger deals.

Given these trends and management's raised outlook for the year, HPE stock may have room to run. It trades at a forward price-to-earnings multiple of 14, which looks cheap relative to analysts' estimates calling for earnings to grow at an annualized rate of 29% over the next several years.

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Micron Technology Micron has been one of the hottest stocks in the market this year, driven by a severe memory bottleneck for AI workloads. Memory demand has historically been highly cyclical, but investors are betting that AI is creating a more sustainable long-term growth trajectory.

The chipmaker's February-ended quarter showed revenue nearly tripling year over year to $24 billion. Demand was strong across all memory products, including DRAM, NAND, and high-bandwidth memory (HBM). The sharp increase in selling prices for these products boosted the company's earnings per share to $12.20, far exceeding analyst estimates of $9.

This is a highly competitive market, with Samsung and SK Hynix also experiencing demand for their memory products. But Micron has gained share in the data center storage market for four straight years. The insatiable demand for memory across multiple markets, including on-device AI processing in consumer devices, has management optimistic about its multiyear prospects.

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However, I'm less bullish on Micron stock the higher it climbs. With the stock's forward earnings multiple now at 17, it is almost trading in line with Nvidia's valuation. Yet memory is still a cyclical market, where additional manufacturing capacity or a slowdown in AI infrastructure spending could weigh on Micron's profits and share price. At these valuation levels, I would rather consider more durable chip companies, such as Nvidia or Taiwan Semiconductor Manufacturing.

Palantir Technologies Palantir is a fast-growing supplier of enterprise and government AI software platforms. It creates a digital copy of a company's operations from its data and workflows, seamlessly integrated with Palantir's Artificial Intelligence Platform (AIP). This effectively allows businesses to quickly spot areas to cut costs and improve efficiency.

The proof of Palantir's value to organizations is in the numbers. Total revenue grew 85% year over year in the first quarter, reaching $1.63 billion -- beating estimates of $1.54 billion. This performance marked Palantir's fastest growth rate yet as a public company.

The company ended the quarter with 1,007 customers, up 31% over the year-ago quarter. Lower growth relative to revenue indicates that existing customers continue to spend more, thereby widening the company's competitive moat. The more customers integrate Palantir into their operations, the stickier it becomes.

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This is a highly profitable business, generating an impressive 44% profit margin, and it's still early in its growth story. This is why the stock commands a premium valuation of 89 times forward earnings. It's expensive, but this multiple aligns with its current growth and analyst projections for 51% annualized earnings growth in the coming years. If it delivers on those expectations, the stock could still outperform.

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.

Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.

Zacks Premium also includes the Zacks Style Scores.

What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.

Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.

The Style Scores are broken down into four categories:

Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.

Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.

Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.

VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.

It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +24% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.

With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.

That's where the Style Scores come in.

You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.

As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.

A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Hewlett Packard Enterprise (HPE - Free Report) Headquartered in Spring, TX, Hewlett Packard Enterprise Company was formed as a result of the split of Hewlett-Packard Company into two separate entities – one focusing on the enterprise-facing hardware and service business and the other focusing on the consumer-facing computer and printer segments.

HPE is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of A.

Additionally, the company could be a top pick for growth investors. HPE has a Growth Style Score of B, forecasting year-over-year earnings growth of 75.8% for the current fiscal year.

Eight analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $1.00 to $3.41 per share. HPE also boasts an average earnings surprise of +16%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, HPE should be on investors' short list.

Key Takeaways DELL is riding strong demand for AI-optimized servers, with earnings estimates rising sharply.MPWR lifted its Enterprise Data growth outlook as AI and server application sales accelerated.HPE is expanding AI, cloud and networking offerings as orders, backlog and cash flow improve. The artificial intelligence (AI)-driven marvelous bull story of U.S. stock markets for the past three and a half years is showing no sign of abatement. The four major U.S. hyperscalers raised their AI capital expenditure budget to $750 billion in 2026. This figure is set to cross $1 trillion next year and is likely to rise further beyond 2027. 

As a result, AI infrastructure stocks are flourishing on Wall Street with more vigor. Here, we have identified three AI infrastructure giants (market capital >$50 billion) with a top Zacks rank for investment. These stocks boast a strong short-term price upside. Moreover, they have a solid long-term (3-5 years) earnings per share (EPS) growth rate, which will ensure a long-term northbound journey. 

The companies are: Dell Technologies Inc. (DELL - Free Report) , Monolithic Power Systems Inc. (MPWR - Free Report) and Hewlett Packard Enterprise Co. (HPE - Free Report) . Each of our picks currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our three picks year to date.

Image Source: Zacks Investment Research

Dell Technologies Inc.Dell Technologies has been benefiting from astonishing server sales powered by AI chips. The massive growth potential of the global AI-optimized server market is noteworthy. In May 2026, FORTUNE BUSINESS INSIGHTS estimated that “the global AI server market size was valued at $194.62 billion in 2025. The market is projected to grow from $262.22 billion in 2026 to $2,847.32 billion by 2034, exhibiting a CAGR of 34.73% during the forecast period.”

Innovative ProductsDell Technologies is benefiting from strong demand for AI-optimized servers driven by the ongoing digital transformation and heightened interest in generative AI applications. Its PowerEdge XE9680 AI-optimized server is much in demand. 

DELL’s advanced AI-optimized servers, including the PowerEdge XE9780 and 9780L platforms supporting up to 256 NVIDIA HGX B300 GPUs per rack, the XE9712 with NVIDIA GB300 NVL72, and the XE7745 supporting NVIDIA RTX Pro 6000 Blackwell GPUs, are noteworthy. 

In fiscal fourth-quarter 2026, DELL launched the PowerEdge XE9712 supporting NVIDIA's NVL72 GB200. It launched the Dell Infrastructure Rack Sobel system, IR7000 and 5000 in both 21-inch and 19-inch versions, providing up to 96 GPUs in a rack and 786 GPUs in a scalable unit. The strong demand trend bodes well for the company’s long-term prospects.

Solid Long-Term EPS Growth Rate Dell Technology has an expected revenue and earnings growth rate of 47.4% and 81.2%, for the current year (ending January 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 42.2% over the last 30 days. DELL currently has a long-term EPS growth rate of 26.4%, well above the S&P 500’s long-term EPS growth rate of 17.6%.

Image Source: Zacks Investment Research

Reasonable ValuationDespite a robust rally this year, the DELL stock still looks reasonably priced. It trades at a forward 12-month price-to-earnings (P/E) multiple of 22.40, in line with the industry average. It also trades at a price/sales (P/S) multiple of 2.03, in line with the industry average.

Strong Short-Term Price UpsideThe short-term average price target of brokerage firms represents an increase of 12.3% from the last closing price of $427.78. The brokerage target price is currently in the range of $290-$700. This indicates a maximum upside of 63.6% and a maximum downside of 32.2%. The risk/reward ratio is 1:2. 

Monolithic Power Systems Inc.Monolithic Power Systems continues to benefit from rising demand for power management solutions tied to AI infrastructure and cloud computing deployments. MPWR continues to broaden its addressable market through targeted technology acquisitions and product portfolio expansion. 

AI Infrastructure MomentumFirst-quarter 2026 Enterprise Data revenues increased 97.7% year over year and 12.6% sequentially due to higher sales for AI and server applications. MPWR raised its Enterprise Data growth floor expectation to nearly 85% year over year from prior expectations of roughly 50%.

Automotive remains a long-term growth driver as semiconductor content rises across ADAS, infotainment and connectivity applications. Beyond automotive, MPWR is broadening its exposure to robotics, building automation and portable AI devices.

MPWR highlighted that its monolithic power architecture enables single-piece silicon solutions versus multi-chip competitor approaches in AI and high-density applications. The company also expanded manufacturing goals beyond its prior $4 billion capacity target and now aims to reach $6 billion of capacity in the near future.

Solid Long-Term EPS Growth Rate Monolithic Power Systems has an expected revenue and earnings growth rate of 32.8% and 35.3%, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 11.1% over the last 60 days. MPWR currently has a long-term EPS growth rate of 27.8%, well above the S&P 500’s long-term EPS growth rate of 17.6%.

Image Source: Zacks Investment Research

Reasonable ValuationDespite an impressive northward journey this year, the MPWR stock still looks reasonably priced. It trades at a forward 12-month price-to-earnings (P/E) multiple of 63.94, in line with the industry average.

Strong Short-Term Price upsideThe short-term average price target of brokerage firms represents an increase of 27.4% from the last closing price of $1,423.76. The brokerage target price is currently in the range of $1,575-$2,000. This indicates a maximum upside of 40.5% and no downside. The risk/reward ratio is extremely favorable.

Hewlett Packard Enterprise Co.Hewlett Packard Enterprise is executing well on its mix shift toward higher-value networking, cloud and AI, supported by the Juniper acquisition, integration running ahead of plan and Catalyst cost synergies. Customer spend on AI inferencing, private cloud and network modernization is driving record orders and backlog, with improved HPE’s profitability and higher free cash flow.

Impressive Business ExecutionHPE continues to simplify the portfolio and concentrate investment behind markets tied to networking, cloud and AI, which management views as long-duration drivers of enterprise technology spend. 

The fiscal 2026 segment realignment, which combined Server, Hybrid Cloud and Financial Services into Cloud & AI, is intended to sharpen accountability around integrated solutions and consumption models.

HPE launched new autonomous, agentic AI operations capabilities and raised its cumulative Networks for AI order target to at least $2 billion by the end of fiscal 2026, reflecting confidence in AI-driven demand for high-performance networking.

HPE is expanding its enterprise AI offerings to make it easier for customers to develop, fine-tune and deploy models across data centers, edge environments and public clouds. The company continues to build turnkey AI factory solutions and Private Cloud AI offerings co-engineered with NVIDIA, aimed at accelerating time to value for inferencing, retrieval augmented generation and model tuning. 

Solid Long-Term EPS Growth Rate Hewlett Packard Enterprise has an expected revenue and earnings growth rate of 31.3% and 75.8%, for the current year (ending October 2026). The Zacks Consensus Estimate for the current year’s earnings has improved 40.9% over the last 30 days. HPE currently has a long-term EPS growth rate of 32%, significantly above the S&P 500’s long-term EPS growth rate of 17.6%.

Image Source: Zacks Investment Research

Attractive ValuationDespite a year-to-date rally, the HPE stock still looks lucrative. It trades at a forward 12-month price-to-earnings (P/E) multiple of 14.20, almost half the industry average of 28.00. It trades at a price/sales (P/S) multiple of 1.65, well below the industry average of 9.11. It also trades at a price/book (P/B) multiple of 2.53, lower than the industry average of 7.17.

Huge Short-Term Price upsideThe short-term average price target of brokerage firms represents an increase of 40.3% from the last closing price of $48.92. The brokerage target price is currently in the range of $52-$80. This indicates a maximum upside of 63.5% and no downside. The risk/reward ratio is extremely favorable.

FREMONT, Calif. & CLEARWATER, Fla.--(BUSINESS WIRE)--TD SYNNEX (NYSE:SNX), a leading global distributor and solutions aggregator for the IT ecosystem, today announced it has earned multiple awards from HPE across Europe and North America. These awards honor HPE partners who have demonstrated outstanding dedication and success in providing value to their customers and helping them realize their full growth potential. The recognition is awarded to HPE partners who have achieved exceptional perfor.

LAS VEGAS--(BUSINESS WIRE)-- #1111systems--11:11 Systems (“11:11”), a leading managed infrastructure solutions provider, today announced it has been named the 2026 HPE Service Provider Partner of the Year for North America by Hewlett Packard Enterprise (HPE). The award marks the company's eighth consecutive year as a top HPE partner. These awards honor HPE partners who have demonstrated outstanding dedication and success in providing value to their customers and helping them realize their full growth potentia.

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HPE Private Cloud AI deploys secure AI agents through new governance and improves tokenomics through scaled AI-data pipelines

The HPE AI Factory with NVIDIA adds NVIDIA Vera CPU, NVIDIA Agent Toolkit, and NVIDIA Confidential Computing

LAS VEGAS--(BUSINESS WIRE)--HPE Discover Las Vegas 2026 – HPE (NYSE: HPE) today announced new innovations to help customers transform into agentic enterprises and move AI into production with greater security, governance, and control. These new offerings transform the HPE AI Factory with NVIDIA for the next era of AI where intelligence adapts, evolves, collaborates, and governs.

As organizations move to operationalize agentic AI and optimize token usage, HPE is delivering technology architected to simplify that journey

Share “As AI becomes more autonomous, organizations need a new architecture to run it securely, govern it responsibly, and scale it economically,” said Antonio Neri, president and CEO, HPE. “Across networking, servers, storage and software, HPE is delivering full-stack AI solutions with NVIDIA that build the foundation for agentic enterprises, helping customers move from experimentation to production with control and confidence.”

“Every layer of the computing stack is being reinvented for the age of AI agents,” said Jensen Huang, founder and CEO, NVIDIA. “Together with HPE, we are building AI factories for this new era of computing — powered by NVIDIA Vera CPUs, accelerated infrastructure, and secure AI software — to help enterprises transform their data into intelligent action.”

Fully-operational enterprise agentic AI in the HPE AI Factory with NVIDIA

Across every industry, enterprises are navigating how to thoroughly harness AI agents in full-scale production environments and to automate business processes and make better decisions. As organizations move to operationalize agentic AI and optimize token usage, HPE is delivering technology architected to simplify that journey while making it more secure and performant. HPE Private Cloud AI, a turnkey AI factory solution co-engineered with NVIDIA, is introducing new capabilities that help customers deploy trusted, enterprise-ready agentic AI with greater control, observability, and efficiency.

Secure and governed agentic AI gives enterprises the controls needed to move agents from development to production with confidence. NVIDIA Agent Toolkit software, including NVIDIA Nemotron open models, NVIDIA NemoClaw, and the NVIDIA OpenShell secure runtime, provide an agent operating system that efficiently reasons, lets customers monitor agent behavior, enforce policies, and reduce deployment risk. HPE Private Cloud AI adds HPE ProLiant Compute DL394 Gen12 with NVIDIA Vera CPU as a compute-optimized foundation for agentic AI and high-performance data processing, including security and management features. New HPE Zerto Software capabilities help customers identify when rogue agent actions take place and use continuous data protection to rewind to a clean slate. HPE Private Cloud AI also supports secure local agent registration, providing customers with the ability to approve AI models, skills, and tools while adhering to centralized governance and security policies.

Data is foundational to the AI journey but can also be its biggest bottleneck. HPE Private Cloud AI helps enterprises turn unstructured data into AI-ready pipelines in minutes while improving inference efficiency. With the built-in intelligence of HPE Alletra Storage MP X10000, customers can automatically apply metadata and governance policies to prepare data for AI applications and cut token response times by up to 20X1. HPE Private Cloud AI helps customers optimize by improving prompt processing efficiency and boosting token throughput by up to 20%2. HPE Data Fabric Software broadens data availability for agentic workflows by extending support of model context protocol (MCP) to Apache Airflow and introduces an enterprise AI inventory that enriches distributed data with metadata. A standalone HPE Data Fabric appliance, available on HPE ProLiant Compute servers, simplifies and accelerates deployment.

HPE Private Cloud AI optimizes a customer’s AI investment by helping to control token costs, maximize GPU utilization, and enable long-term scalability. New capabilities include a unified model gateway for governed frontier model access, active workload prioritization, and multi-node inferencing for up to 256 GPUs. Fine-tuning of pre-trained AI models, including NVIDIA Nemotron open models, with secure access to existing enterprise data for agentic AI is supported through NVIDIA NeMo.

More security for the large-scale HPE AI Factory

HPE is enhancing HPE AI Factory at-scale and HPE Sovereign AI Factory by introducing the following new capabilities:

NVIDIA Confidential Computing for at-scale and sovereign architecture: HPE is integrating NVIDIA Confidential Computing for the HPE AI Factory through HPE Services. NVIDIA Confidential Computing protects models and private data during execution for on-premises or sovereign deployments. Establishing a chain of trust through cryptographic attestation and encryption at every stage to verify hardware, software, and datasets, enabling the HPE AI Factory to comply with regional or industry standards3. Across the HPE AI Factory, NVIDIA BlueField and NVIDIA DOCA enable zero-trust policy enforcement, runtime threat detection, and networking encryption – helping enterprises protect AI workloads, agents and data across the AI factory while maintaining performance and operational efficiency. Enhanced NVIDIA integration: HPE AI Factory at-scale and HPE Sovereign AI Factory will be available with NVIDIA RTX PRO 6000 Blackwell Server Edition GPUs, NVIDIA Spectrum-X Ethernet, NVIDIA BlueField-3 DPUs, and NVIDIA ConnectX-8 SuperNICs. The full-stack HPE AI Factory is based on NVIDIA reference architectures and supports a broad range of use cases, from AI development to production-ready deployments at scale – with software including NVIDIA AI Enterprise and ecosystem partners in the HPE Unleash AI program. HPE also recently announced it is broadening its AI factory solutions with NVIDIA Vera Rubin NVL72 by HPE rack-scale system, HPE Compute XD700 built on NVIDIA HGX Rubin NVL8, the HPE Cray Supercomputing GX240 Compute blade designed with NVIDIA Vera CPUs, and NVIDIA Quantum-X800 InfiniBand support for the HPE Cray Supercomputing GX5000.

Availability

The new HPE Private Cloud AI features will be available July 2026. HPE Data Fabric Software will be available October 2026. Additional HPE Private Cloud AI products and features including agentic observability, data intelligence, HPE Alletra Storage MP X10000, NVIDIA Agent Toolkit support and NVIDIA NemoClaw, will be available in Q4 2026. HPE Zerto Software support for agent action monitoring and continuous data protection will be available for Q4 2026. HPE Private Cloud AI with HPE ProLiant Compute DL394 Gen12 will be available in 2027. NVIDIA Confidential Computing will be available for HPE AI Factory with NVIDIA in Q4 2026. HPE AI Factory with NVIDIA RTX PRO Blackwell Server Edition GPUs, Spectrum-X Ethernet, BlueField-3 DPUs, and ConnectX-8 SuperNICs is available now. For more information, see HPE AI Factory With NVIDIA Expands for the Era of Agents.

About HPE

HPE (NYSE: HPE) is a leader in essential enterprise technology, bringing together the power of AI, cloud, and networking to help organizations achieve more. As pioneers of possibility, our innovation and expertise advance the way people live and work. We empower our customers across industries to optimize operational performance, transform data into foresight, and maximize their impact. Unlock your boldest ambitions with HPE. Discover more at www.hpe.com.

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Key Takeaways Finding the best Zacks Rank #1 (Strong Buy) momentum stocks to buy in June and the second half of 2026.Buy soaring artificial intelligence infrastructure stock HPE for growth, value, and upside. The stock market soared on Monday as investors celebrated the possibility that the Strait of Hormuz could reopen by the end of the week. Trump also said the U.S. reached the foundation of a lasting ceasefire with Iran that gives all the parties time to hammer out a larger agreement in the coming months.

The market cooled off a bit on Tuesday, even as oil prices tanked again. But the bulls have pushed the Nasdaq and the S&P 500 right back above their 21-day moving averages and within touching distance of their peaks.

If the critical oil and commodities choke point does open by Friday and the ceasefire holds, the bulls might be ready to spur the market to new highs in the back half of June.

Given this backdrop, investors likely want to keep buying stocks to make sure they are exposed to another potential rally. Some investors might want to start buying into beaten-down stocks, hoping that a turnaround is in sight. But it might be more prudent in the near-term to buy stocks that have already proven themselves to be winners in the 2026 market conditions.

The momentum stocks this screen puts on your radar have seen strong upward earnings revisions, earning them a Zacks Rank #1 (Strong Buys) right now.

Let’s dive into how investors can find the best "Strong Buy" momentum stocks to add to their portfolios right now in June and heading into the second half of 2026. 

Screen Basics: Finding Top Momentum Stocks to BuyThe screen we are looking into today comes loaded with the Research Wizard. The screen helps investors dig through all of the Zacks Rank #1 (Strong Buy) stocks, of which there are over 200 at any given time, to find some of the top momentum names.

The screen narrows down the list of Zacks Rank #1 (Strong Buy) stocksto those with upward price momentum that are also trading within 20% of their 52-week highs. The screen then uses the PEG ratio and the Price to Sales ratio to help make sure investors are getting value as well. The screen then makes your life a little easier and narrows it down to just seven stock picks.

The screen basics are listed below…

·       Zacks Rank = #1 (Strong Buy)

·       Current Price/52-week High >= 0.8

·       PEG Ratio: P/E F(1)/EPS Growth <= 1

·       Price/Sales <= 3

·       Percentage Change Price -12 Weeks = Top # 7

This strategy comes loaded with the Research Wizard and it is called bt_sow_momentum_method1 It can be found in the SoW (Screen of the Week) folder.

The screen is simple, yet powerful. Here is one of the seven stocks that made it through this week's screen…

Buy Soaring AI Stock HPE for Growth, Value, and 40% UpsideHewlett Packard Enterprise (HPE - Free Report)  builds the behind-the-scenes technology that powers AI data centers, computer networks, and more. It makes servers, networking equipment, storage systems, and offers cloud-like services that help businesses run AI, store data, and manage their IT needs.

HPE is benefiting from surging demand driven by the AI spending boom, as hyperscalers like Meta and Microsoft pour hundreds of billions into data centers.

Image Source: Zacks Investment Research

The server and networking company raised its FY26 guidance when it reported its Q2 results on June 1, as “customers continue to invest in modernizing their infrastructure and scaling AI.” HPE’s earnings revisions skyrocketed 42% for FY26 and 50% for FY27 as the technology company rides the historic capex-heavy spending spree.  

The AI infrastructure stock’s upward revisions earn it a Zacks Rank #1 (Strong Buy). It is projected to grow its revenue by 31% in FY26 and 12% next year to reach $50.36 billion vs. $34 billion in FY25. HPE’s adjusted earnings are projected to skyrocket 76% this year and 18% next to hit $4.02 a share, doubling 2025’s $1.94 a share in the process.

Image Source: Zacks Investment Research

HPE’s 100% YTD surge helped it break out of a prolonged stretch of sideways trading to new all-time highs. The stock has dipped over 10% from its early June peaks alongside the market and all things AI.

But it found support at some key technical levels already, and its average Zacks price target still marks 40% upside from Tuesday’s levels. The AI data center infrastructure stock trades at 14.8X forward 12-month earnings, marking a 55% discount to its highs. 

Get the rest of the stocks on this list and start looking for the newest companies that fit these criteria. It's easy to do. And it could help you find your next big winner. Start screening for these companies today with a free trial to the Research Wizard. You can do it.

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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

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