A relative bright spot in the tech space this year is poised to fall back to the pack, according to Deutsche Bank. Analyst Sidney Ho downgraded Hewlett Packard Enterprise to hold from buy, saying in a note to clients that the company was due for slowdown in growth. “We believe the stock is likely range-bound in the near to medium term. While HPE saw four consecutive quarters of 20%+ y/y order growth, we expect order growth to start decelerating (or even turning negative) as IT spending starts to slow down,” Ho said. Shares of HPE have held up better than other tech stocks this year, falling about 13% in 2022. The Invesco QQQ Trust , for comparison, is down more than 30%. Supply chain issues have been one of the issues facing tech this year, and that could continue to hurt HPE. “We also note that HPE’s supply chain has lagged its peers, which could lead to share losses as demand trends continue to be supply-driven,” Ho said. Deutsche trimmed its price target to $16 per share from $18. The new target is about 16.8% above where the stock closed on Monday. Deutsche has not soured on tech stocks as a whole however. In the same note, Ho upgraded NetApp to buy, citing growth in its public cloud business and stock buybacks. — CNBC’s Michael Bloom contributed to this report.
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