Analyst’s Keeping an Eye on VMware, Inc. (NYSE:VMW)

Analysts are weighing in on how VMware, Inc. (NYSE:VMW), might perform in the near term. Wall Street analysts have a much less favorable assessment of the stock, with a mean rating of 2.7. The stock is rated as buy by 8 analysts, with 2 outperform and 24 hold rating. The rating score is on a scale of 1 to 5 where 1 stands for strong buy and 5 stands for strong sell.

For the current quarter, the 30.00 analysts offering adjusted EPS forecast have a consensus estimate of $0.95 a share, which would compare with $0.93 in the same quarter last year. They have a high estimate of $0.96 and a low estimate of $0.94. Revenue for the period is expected to total nearly $1.68B from $1.60B the year-ago period.

For the full year, 33.00 Wall Street analysts forecast this company would deliver earnings of 4.15 per share, with a high estimate of $4.18 and a low estimate of $4.04. It had reported earnings per share of $4.06 in the corresponding quarter of the previous year. Revenue for the period is expected to total nearly $6.90B versus 6.65B in the preceding year.

The analysts project the company to maintain annual growth of around 12.34% percent over the next five years as compared to an average growth rate of 17.19% percent expected for its competitors in the same industry.

Among the 23 analysts Data provided by Thomson/First Call tracks, the 12-month average price target for VMW is $63.20 but some analysts are projecting the price to go as high as $90.00. If the optimistic analysts are correct, that represents a 41 percent upside potential from the recent closing price of $64.00. Some sell-side analysts, particularly the bearish ones, have called for $50.00 price targets on shares of VMware, Inc. (NYSE:VMW).

In the last reported results, the company reported earnings of $0.93 per share, while analysts were calling for share earnings of $0.91. It was an earnings surprise of 2.20%percent. In the matter of earnings surprises, the term Cockroach Effect is often implied. Cockroach Effect is a market theory that suggests that when a company reveals bad news to the public, there may be many more related negative events that have yet to be revealed. In the case of earnings surprises, if a company is suggesting a negative earnings surprise it means there are more to come.

VMware, Inc. provides virtualization and cloud infrastructure solutions in the United States and internationally. Its virtualization infrastructure solutions include a suite of products and services designed to deliver a software-defined data center (SDDC), run on industry-standard desktop computers, servers and mobile devices; and support a range of operating system and application environments, as well as networking and storage infrastructures. The company offers VMware vSphere, a SDDC platform, which enables users to deploy hypervisor, a layer of software that resides between the operating system and system hardware to enable compute virtualization; storage and availability products that provides data storage and protection options; network and security products; and management and automation products to manage and automate overarching IT processes involved in provisioning IT services and resources to users from initial infrastructure deployment to retirement. It also provides SDDC suites, such as VMware vCloud Suite, VMware vSphere with Operations Management, and VMware vRealize suite for building and managing cloud infrastructure for use with the VMware vSphere platform. In addition, the company offers hybrid cloud computing solutions, including VMware vCloud Air Network Service Providers and VMware vCloud Air; and end-user computing solutions, which enables IT organizations to deliver secure access to applications, data, and devices to end users. It sells its products through distributors, resellers, system vendors, and systems integrators. The company was incorporated in 1998 and is headquartered in Palo Alto, California. VMware, Inc. is a subsidiary of EMC Corporation.