Dump your HP stock. And now

Goldman Sachs, the outfit which gave such sterling advice during the subprime mortgage scandal, has warned shareholders to dump HP stock.

Shares in the maker of expensive printer ink fell by six percent after Goldmine Sex downgraded the company to “sell” – warning that investors may be overestimating the company’s chances of a successful turnaround while it grapples with its declining PC and printing business.

On the face of it there is nothing that shareholders have not known for ages. HP is restructuring and chief exec Meg Whitman has said this will take years. HP’s hardware business is also struggling with intense competition in its servers and storage hardware division.

Goldmine claims that what is different is that the company needs to re-invest any savings from its current overhaul in research and business development. This means that its earnings may continue to come under pressure this year and beyond.

It claimed that all the other cocaine nose jobs on Wall Street seemed to think that the worst of things was over for HP and that there is an unreasonably high probability to the turnaround’s success.

The City thinks that HP’s fundamentals have bottomed, but antibiotics often do have the side effect of a bottoming your fundamentals, so we think that is a cause for sympathy.

“In contrast, we believe EPS expectations could face downward revisions in coming quarters,” Goldmine ominously said.

Reuters reports that shares of HP could be picked up second hand for $21.85 which was down 6.3 percent.