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3 Tech Stocks Facing the Blue Screen of Death

The Post-PC age does not bode well for these aging companies

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Those of you who thought it was impossible for Hewlett-Packard (NYSE:HPQ) to go any lower have been forced with an ugly reality in 2012: The bottom has not been reached, and it could be a long way down in the near future based on recent information.

Consider HP has suffered four straight quarters of year-over-year revenue declines. Consider that in Q3, it posted it worst quarterly loss in the history of the company thanks to mammoth writedowns associated with restructurings and botched buyouts. Consider that even if you exclude one-time charges, profits fell 9% year-over-year anyway. And it cut its 2013 guidance to boot.

Most importantly, consider that Meg Whitman called an analyst event in October that was simply designed to plead for patience and tout a snail’s-pace turnaround that wouldn’t get HPQ poised for growth until 2014 — and only then if all the cards fell right.

Sure, HP has a 4% dividend yield that is very sustainable, but that’s not enough of a reason to buy. This is a company that has wasted the past five years on musical chairs in the corner office and multiple failures in product development.

The PC and printer business at HP is slowly declining both nominally and on a market-share basis — Hong Kong’s Lenovo (PINK:LNVGY) just overtook HP as the world’s top PC maker — and there’s nothing to replace that lost revenue. Whitman hopes enterprise software will pick up the slack, but competing with the likes of Oracle (NASDAQ:ORCL), Cisco (NASDAQ:CSCO), Juniper (NYSE:JNPR) and other entrenched names will be no easy task.

HP won’t disappear anytime soon with $9.9 billion in gross cash in the bank as of last quarter. But if this is its grand vision, investors are better served looking elsewhere in tech.

Article printed from InvestorPlace Media,

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