VMware (VMW) Dips More Than Broader Markets: What You Should Know
VMware (VMW) closed the most recent trading day at $140.82, moving -0.91% from the previous trading session. This change lagged the S&P 500's daily loss of 0.62%. Meanwhile, the Dow lost 0.69%, and the Nasdaq, a tech-heavy index, lost 0.94%.
Heading into today, shares of the cloud computing company had lost 4.9% over the past month, lagging the Computer and Technology sector's gain of 2.56% and the S&P 500's gain of 3.51% in that time.
Investors will be hoping for strength from VMW as it approaches its next earnings release. In that report, analysts expect VMW to post earnings of $1.45 per share. This would mark a year-over-year decline of 9.38%. Meanwhile, our latest consensus estimate is calling for revenue of $2.80 billion, up 14.86% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.01 per share and revenue of $11.44 billion, which would represent changes of -3.69% and +11.83%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for VMW. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. VMW is currently sporting a Zacks Rank of #3 (Hold).
Digging into valuation, VMW currently has a Forward P/E ratio of 23.64. This represents a discount compared to its industry's average Forward P/E of 31.98.
Investors should also note that VMW has a PEG ratio of 1.78 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Software was holding an average PEG ratio of 2.76 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 114, which puts it in the top 45% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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