At the start of the year, HPE's share price was trading precisely where it had been when the Group's two divisions were separated eight years earlier. The contrast with the fortunes of HP - the consumer electronics division - which saw its market capitalization triple over the period, was all the more painful.

The lack of sales and earnings growth, erratic cash flows and significant margin compression had discouraged investors. Added to this were massive share buybacks between 2017 and 2019, at a time when HPE's valuation multiples were moving - in the space of just a few months - into overheated territory.

This earned the group a clear valuation discount to comparables such as Dell or Cisco. The former, it's true, has enjoyed better growth performance since its mega-merger with EMC; the latter, for its part, achieves margins three times that of HPE. So the penalty was not stolen.

A change of direction may be just around the corner, thanks in particular to the acquisition of Juniper Networks - whose financial dynamics are not unlike those of HPE. Presented as a direct bet on AI, this transaction, still subject to approval by the competition authorities, values Juniper at almost forty times its operating profit.

This underlines its strategic nature, as HPE is valued at fourteen times operating profit, Dell at seventeen times and Cisco at twenty-two times. Let's hope that the fate of this expensive acquisition will be less disastrous than that of Autonomy in 2011 - the start of a legendary rout for Hewlett-Packard, which precipitated the group's demise four years later.

Another potential reason for hope is HPE's recent very good quarter, with sales up 15% year-on-year at the same time, and forecasts of a similar kind for the first quarter of 2025, which is just beginning.

These gains, it should be noted, are entirely due to exponentially rising server sales in recent months. This would not be the first time, as HPE's business sector remains prone to such effects.

In any case, the end of the 2024 financial year lends itself to taking a step back and taking a long view of HPE's economic performance, which in nine years has generated $15 billion in cumulative free cash flow. Over the period, $17.5 billion has been returned to shareholders, mainly via share buybacks - although HPE has eased up on the latter in recent years. The $2.5 billion in additions were thus financed by a similar increase in debt.

This tends to lend credence to those analysts who argued that a market capitalization of less than $20 billion was unfairly depressed. The fact remains, however, that in a cyclical and hyper-competitive business sector, value creation can only be achieved through a well-honed M&A strategy - an area in which HPE's track record is hardly stellar, as has been said.

But every saint has a past, and every sinner a future. In the light of the Juniper takeover, HPE's shareholders would like nothing better than to verify the validity of this old maxim.