Hewlett-Packard (NYSE:HPQ) is bucking the trend once again. The biggest 52-week loser on the Dow Jones Industrial Average (DJINDICES:^DJI) is surging 0.7% as of 1:40 p.m. EST, while the index itself has plunged 0.6%. Only eight of the 30 components trade in positive territory right now, and HP's jump is the largest of them all.
But there's no substance to HP's pop today. The biggest news out of Palo Alto is a handful of new products, all unveiled at this week's Consumer Electronics Show in Las Vegas. They include a cheap touchscreen notebook, monitors with upgraded audio, and a somewhat controversial wireless media player, which allows you to store streaming videos from Netflix (NASDAQ:NFLX) and Hulu to view offline later.
Hardly the stuff of legend. The exception would be the "download now, watch later" solution for streaming video -- but that one seems to open a hornet's nest of licensing and copyright controversy. Given the outcry TV stations raised when little upstart Aereo gave New Yorkers online access to simple over-the-air broadcasts, I can't imagine that the content giants who make Hulu and Netflix interesting will allow HP to sell this thing. It's a nonstarter.
But that's the best explanation I can come up with for HP's move today. Other than this, it must be pure speculation that the time-honored technology giant will get back on its feet again. The PC market may be dead, but HP must have all the tools necessary to make a full recovery anyhow. The company is diverse, deep-pocketed, and packed to the rafters with engineering talent. A big bounce is inevitable.
Will that drooping blue line ever rise again? Unfortunately, I don't think so. HP has become irrelevant in several of its core markets over the last couple of years, and I blame ex-CEO Mark Hurd -- not for the leadership turmoil that started when he was fired under scandalous circumstances (though that sure didn't help any). No, I blame Hurd's cost-cutting moves in the years before his exit. Decades of well-deserved respect and value were undone by a series of swift moves that made HP look good in the short term but undermined the company's innovation engines and long-term prospects.
If the PC dies and takes HP's still-profitable printer division with it, sector neighbors Microsoft (NASDAQ:MSFT) and Intel (NASDAQ:INTC) may very well find ways to prosper anyhow. Mr. Softy makes boneheaded moves, too, but none so damaging as Hurd's cost-cutting chainsaw massacre. And Intel looks so solid right now, I bought shares last month.
But there's no turning back for HP. Avoid this value trap at all costs.
Fool contributor Anders Bylund owns shares of Netflix and Intel and has also created a bull call spread on top of his Netflix shares. He holds no other position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+.
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