While investors applauded Hewlett Packard Enterprise ‘s first quarterly performance as an independent company — beating Wall Street estimates and driving its stock up more than 13% Friday — some analysts and owners are pushing CEO Meg Whitman to compete harder. That means more aggressively taking on cloud enterprise leaders Amazon ( AMZN ) and Microsoft ( MSFT ), and buying up software rivals such as Workday ( WDAY ) or Salesforce.com ( CRM ), rather than directing cash to shareholders. “I think we need to give Meg a chance to see if she can take advantage of the opportunities in servers with the cloud migration led by Amazon Web Services, Alphabet ‘s ( GOOGL ) Google and Microsoft on the service and software side,” said Daniel Morgan, vice president of Synovus Trust, which holds 251,971 shares of HPE, in a Friday interview with IBD. “Further, the 54% year-over-year growth in the Q1 2016 quarter in networking allows HPE to build more momentum in this space” vs. rivals Cisco Systems ( CSCO ) and Juniper Networks ( JNPR ), he said. “And finally as we discussed before, the huge opportunity to expand the software unit with its 17%-plus operating margins (enables) a large acquisition in the cloud space. Right now software is just 8%-10% of total HPE revenues.” Buying enterprise software rivals Salesforce or Workday specifically is “a chance to make that unit significant by bringing it up to 20%-25% of revenues,” he said. “Post-split, Hewlett Packard Enterprise was supposed to be the growth portion of the Hewlett-Packard Co., (creating) a reinvigorated growth company.” Nevertheless, happy with HPE’s earnings performance issued after Thursday’s market close, investors bid up its stock up 13.5% to close at 15.44 in the stock market today . That’s less than 3% below its Dec. 1 high since splitting from its parent Nov. 1. For now, HPE stockholders interested in growth of any kind will need patience because the company is still shrinking, despite the slight Q1 beat. Hewlett Packard Enterprise reported earnings of 41 cents per share in the fiscal Q1 ended Jan. 31, on sales down 3% to $12.72 billion vs. pro forma figures from a year earlier. The results slightly beat the average view of analysts polled by Thomson Reuters, which called for EPS of 40 cents on sales of $12.68 billion. The non-GAAP 41 cents EPS is down from 47 cents a year earlier. (However, if HPE had been a standalone company at the time, Q1 2015 adjusted EPS would have been 44 cents, the company said in a March 1 note.) That’s pretty much as planned, with HPE not projecting much growth until fiscal 2018. For Q2 ending in April, HPE expects EPS ex items of 39 cents to 43 cents. Analysts polled by Thomson Reuters expected Q2 EPS ex items of 42 cents on sales of $12.297 billion before Thursday’s earnings release, but on Friday, the revenue consensus was revised up to $12.332 billion. For the entire fiscal 2016 ending Oct. 31, analysts polled by Thomson Reuters projected $1.87 EPS ex items for fiscal 2016 ending Oct. 31, on revenue revised up Friday to $50.805 billion. HPE earlier had modeled $50.81 billion in revenue in fiscal 2016, down 2.5% from a $52.12 billion pro forma in fiscal 2015. The slightly smaller half of the old Hewlett-Packard Co., now called HP Inc. ( HPQ ), kept the legacy PCs, printers and ticker. HP Inc. lifted 0.6% to 11.18 Friday. Hewlett Packard Enterprise kept the enterprise software, servers, networking and financial services businesses. “Backing Up The Truck” To Buy HPE Stock To encourage patience among Hewlett Packard Enterprise shareholders, CFO Tim Stonesifer said HPE will “return at least 100% of our free cash flow outlook to shareholders” in fiscal 2016, after devoting $1.3 billion to share repurchases and dividends in Q1. In “addition,” Stonesifer said, shareholders will receive a “majority” of proceeds from the sale of a 51% stake in its Chinese server and storage business to Tsinghua Holdings, valued at $2.3 billion at the time the deal was announced last May. The transaction was supposed to be done by February, but Whitman said regulatory delays have pushed back closing to May, after which the cash will flow to shareholders. To UBS analyst Steve Milunovich, who complained in the post-earnings-release conference call that HPE shares were priced too low, Whitman chuckled: “We appreciate that, which is why we’re backing up the truck” to buy back more shares, which helps boost the price. Avoiding “Frankenstein Of Architecture” Whitman advised analysts that by investing internally and encouraging organic growth “you don’t end up with a Frankenstein of architecture” as the company would risk doing by growing through acquisitions. She cited HPE for pursuing both paths. “Our innovation engine is firing on all cylinders, and you’re going to see some amazing new introductions in the coming quarters in key areas of the portfolio, including servers, cloud, high-performance computing, IoT (Internet of Things), all-flash storage, Aruba and converged systems.” Aruba Networks is a networking leader in mobile enterprise that the old Hewlett-Packard agreed to buy last March for about $3 billion, strengthening the new HPE’s rivalry with Cisco Systems and Juniper Networks. As for “taking advantage of the disruption in the marketplace,” Whitman said, “we learned a lot about how to do this in the context of IBM’s ( IBM ) sale of their server business to Lenovo. … We have a big opportunity to go take (merging) Dell and EMC ( EMC ) business, much as we took a lot of the Lenovo business that would have gone to Lenovo.” She told CNBC on Friday that “in the last quarter, we had about 107 deals that we actually took from Dell/EMC.” She also told analysts that HPE has become the “leading infrastructure provider for SAP ( SAP ) HANA (application server) with nearly twice the number of shipments over the next competitor.” In the cloud, she said, “following a major wave of product releases across our HPE Helion portfolio in the second half of 2015, we are seeing strong customer traction. In fact, since separation, Helion has gained over 200 customer wins, including some of the world’s largest banks, service providers and industrials.” It just wasn’t enough for Needham analyst Richard Kugele, who chided the company in a research note issued Friday, arguing that the $2.3 billion windfall from Tsinghua should be spent on organic or M&A growth, not shareholders’ short-term benefit. “We had hoped that post-split, HPE would be able to focus on getting its house in order and leverage its cash and balance sheet to buy/invest in solutions that solve their product gaps,” Kugele said. “Instead, the company seems intent on continuing financial engineering by doubling its cash return to shareholders (including the pending Tsinghua cash). In our view, this creates no sustainable value for the company or its investors but merely provides a floor for the stock during a period of poor enterprise spending. “With no material growth, revenue improvement or product strategy to build a buy thesis around, we reiterate our hold rating on the stock.” Said Morgan, the Synovus Trust portfolio manager who wants to give Whitman time to execute: “I did hear HPE management touting its share repurchases and FCF (free cash-flow) generation capability on the call. And this is very reminiscent of when Mark Hurd was leading HPQ (the former Hewlett-Packard Co.) and grew the share price through financial engineering and not new product growth.” Hurd is now co-CEO of Oracle ( ORCL ), one of HPE’s toughest software rivals, and another legacy giant growing slowly.