Hewlett-Packard Shares—Cheap Is No Reason to Buy

AP

Hewlett Packard

That's what the trading community is saying this morning in the aftermath of Hewlett-Packard's disappointing report — PC sales down 10 percent?

Hewlett-Packard is now near a 7-year low. Dell is at a 3.5-year low. Still no takers.

HPQ is $18.00. Fiscal 2013 earnings estimates are about $4.25, do the math and you get a P/E ratio of 4.2. Yikes! You would think this is an incredible bargain! The S&P 500 trades at nearly 14x forward earnings. IBM at 10, Microsoft at 13.

But there are no enthusiastic buyers for HPQ stock. Volume is huge — well north of 50 million shares just prior to 1pm ET, normal volume is 19 million shares for the full day — but the stock gapped down almost 5 percent at the open. (Read more: Dow Falls 100 Points, Led by H-P)

Even analysts — a bullish lot by nature — aren't enthusiastic. According to Thomson/First Call, of 34 analysts who cover the stock, 11 have a Buy/Overweight rating, 17 have a hold and 6 have a Sell/Underweight rating.

And the headlines from the analysts have been very bland — the trader/analyst community had very low expectations: "Headline Results OK," "HP Sings the PC Blues," "Bulls and Bears Square Off Again," "Disaster Averted," certainly does not indicate alarm bells are going off.

—By CNBC’s Bob Pisani

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