H-P's slide bad news for three Fidelity funds

Investors in three of Fidelity Investments' mutual funds have the most to lose in the wake of the resignation of Hewlett-Packard Co. chief executive Mark Hurd, though analysts said that they think that the stock is a better buy now as a result of the scandal. On Friday, H-P fired him after discovering that he had submitted inaccurate expense reports that the company claimed were meant to conceal his relationship with a contractor, Jodie Fisher, who worked with him. She in June had accused Mr. Hurd of sexual harassment, but H-P's board determined that he hadn't violated the company's sexual harassment policy. The news of his firing Friday sent H-P's stock down 10% that day (Ticker:HP), and it closed at $41.85. That wasn't good news for investors in three Fidelity funds that had the largest percent of assets invested in the technology company as of June 30, according to Lipper Inc. As of June 30, the Fidelity Select Computers Portfolio Ticker:(FDCPX) had 11.9% invested in H-P, the Fidelity Congress Street Fund Ticker:(CNGRX) had an 8.6% weighting in the stock, and the Fidelity Exchange Fund Ticker:(FDLEX) had 8.2% invested, according to Lipper. Sophie Launay, a Fidelity spokeswoman, declined to comment, citing company policy not to comment on individual holdings. Analysts, however, said that while Mr. Hurd's firing is a short-term issue for H-P, they think it is a good time to buy the stock. “We recognize that this is a big deal, a big situation and a big hit, but we felt that the company is no longer in a turnaround mode like it was when Mr. Hurd took over in 2005, and he has really transformed the company,” said Louis Miscioscia, an analyst at Collins Stewart LLC, who maintained his “buy” rating on H-P. The dismissal of Mr. Hurd is a very different circumstance than the dismissal of his predecessor, Carly Fiorina, who was pushed out in 2005 over clashes with the board. “There is turmoil today, but for different reasons,” said Michael Holt, a senior stock analyst at Morningstar Inc. “The company wasn't executing well when Hurd came in, but today the company is executing well, but the leader had to step down. I think it's a good time to buy,” Mr. Holt said.