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Holly LaFon
Holly LaFon
Articles (8062) 

Wallace Weitz Comments on Hewlett-Packard

April 11, 2013 | About:

Another tarnished technology company, Hewlett-Packard (HPQ), provided a more positive experience. We first bought HPQ in the low $20’s with the thought that a company with $3-4 per share earning power would trade considerably higher when negative news gave way to “adequate” news. Last fall, as investors chased Apple up to $700 per share on the assumption that iPads would replace PC’s and make printing obsolete, HPQ fell below $12. We believed that Meg Whitman was making progress in stabilizing the company and we bought more at various prices down into the $11’s. Over the past few months, we have enjoyed a strong rebound to $23 (Period ending 3/31/13), and we have taken profits in the majority of our shares. This is not our preferred type of investment—our first choice is the great (growing) business at a reasonable price—but we will occasionally indulge in this type of “deeper value” situation.

From Wallace Weitz's first quarter letter to shareholders.

Rating: 3.0/5 (6 votes)


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