why did vmware stock drop

by Ally Keeling Published 3 years ago Updated 2 years ago

VMW’s Stock Has Fallen Because The Situation On The Ground Has Changed: VMW stock has suffered as states and countries are on lockdown. As industries have halted production and services, the demand for software, and web services have also taken a hit with consumers focusing solely on essentials and not discretionary products.

VMware Inc. shares declined after the company gave forecasts for sales and profit in the current quarter that fell short of analysts' projections. Earnings, excluding some items, will be $1.56 a share on revenue of $3.19 billion in the three months ending in April, the company said Thursday in a statement.Feb 24, 2022

Full Answer

Should you buy VMware stock?

Aug 27, 2021 · So what. After market hours on Thursday, VMware revealed that its second-quarter 2022 revenue was $3.14 billion, a 9% improvement year over year. The cloud computing specialist's adjusted net ...

What caused VMware’s Q2 results to fall?

Aug 27, 2021 · Let’s dive into why investors are pricing in negative sentiment in VMware following its earnings. VMW Stock Drops on Disappointing Earnings Release Looking at VMWare’s recent Q2 results, it appears...

What do analysts expect from VMware (VMware) stock in fiscal 2022?

Shares of virtual computing veteran VMware ( VMW -0.09% ) crashed on Friday, following the release of mixed fourth-quarter 2020 results. By 3 p.m. EST, the stock was down 9.5%.

Is VMware (VMW) down 8% today?

Dec 15, 2021 · Why VMW Could Bounce Back Before Long The RSI reading of 29.85 for VMW is an indication that the heavy selling could be in the process of exhausting itself, so the stock could bounce back in a...

Is VMware a good stock to buy now?

VMware is still a bargain right now according to my price multiple model, which compares the company's price-to-earnings ratio to the industry average. In this instance, I've used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock's cash flows.Feb 15, 2022

Why VMware stock is up?

VMware's revenues and earnings benefited from the pandemic as lockdowns promoted digitization of organizations with a push for remote working. The momentum continued in Q1 2022 (ended April 2022) as the company recorded revenue growth of 9% y-o-y to $ 3 billion.Jan 12, 2022

Is VMware stock undervalued?

The stock's ratio of 28.21x is currently well-below the industry average of 41.55x, meaning that it is trading at a cheaper price relative to its peers. Another thing to keep in mind is that VMware's share price is quite stable relative to the rest of the market, as indicated by its low beta.Feb 10, 2022

Is VMware in decline?

As a result, VMware stock tumbled more than 6% in after-hours trading. Net income in the quarter fell 3% from the same quarter last year, but the decline was expected. Operating income also fell about 3%, to $924 million.Aug 26, 2021

What is happening with VMware?

Dell Technologies has shed its 81 percent stake in VMware to Dell Technologies shareholders, creating an independent software company with a market value of approximately $64 billion. In a move to appeal to a larger group of investors, Dell will start paying a dividend and will end its multi-class share structure.Nov 1, 2021

Is VMware a profitable company?

On a conference call with analysts late Tuesday, VMware projected fourth-quarter revenue of $3.51 billion, up 7% from a year ago, with non-GAAP profits of $1.96 a share; Street consensus had been $3.59 billion and $1.89 a share.Nov 24, 2021

Does VMware stock pay dividends?

VMWARE (NYSE: VMW) does not pay a dividend.

Will VMware be acquired?

Dell is scheduled to spin off its 81 percent stake in VMware to Dell Technologies shareholders in November 2021, the biggest of which is Dell's founder and CEO Michael Dell.Sep 21, 2021

Will Dell stock go up?

According to its forecast, as of 11 March 2022, the Dell stock price could reach $16.241 at the end of 2022, $0.000000946 in 2023 and to 0.000001 by the close of 2024 and until February 2025.Mar 11, 2022

Is VMware forward guidance?

Finally, VMware provided forward guidance in line with its previous full-year guidance (as of last quarter). Investors appeared to have been looking for some sort of guidance boost. Accordingly, expectations are that this shifting mix of revenues is likely to continue. Such a move could put pressure on the company’s valuation. This appears to be the case today.

Is VMware stock stable?

After all, this enterprise software company has been an incredibly stable growth stock that long-term investors have flocked to in recent years. Over the past five years, shares of VMW stock have approximately doubled, growing in a rather consistent fashion.

What happened

Shares of virtual computing veteran VMware ( VMW 0.02% ) crashed on Friday, following the release of mixed fourth-quarter 2020 results. By 3 p.m. EST, the stock was down 9.5%.

So what

VMware's fourth-quarter sales rose 11% to $3.07 billion, just ahead of Wall Street's consensus estimate of $2.95 billion. Adjusted earnings increased by 9% to $2.05 per diluted share. Here, your average analyst had been expecting earnings near $2.17 per share.

Now what

Looking ahead to fiscal 2021, VMware guided full-year revenue to approximately $12.1 billion, a 12% year-over-year growth rate. Earnings for this period should land near $6.55 per share, a 5% increase from fiscal 2020.

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Why did Dell fight with shareholders?

Dell fought with shareholders over claims that he bought Dell cheap and used complex financial engineering in the EMC deal to short-change investors.

Does Dell give stockholders cash?

Dell Technologies stockholders will receive cash instead of any fractional shares of VMware Class A .

How much will VMware make in 2021?

VMware’s revenues for full-year 2021 were $11.8 billion – up 8.8% y-o-y, with high growth seen in the Subscription and SaaS segment. Trefis estimates VMW’s fiscal Q3 2022 (ended Oct 2021) revenues to be around $3.3 billion, above the $3.1 billion consensus estimate. We expect Subscription and SaaS segment growth to drive the growth in the Q3. Our dashboard on VMware’s revenues offers more details on the company’s operating segments along with our forecast for the next two years.

When will VMware report Q3 results?

VMware’s stock (NYSE: VMW) is scheduled to report its fiscal Q3 2022 (ended Oct 2021) results on Tuesday, November 23. We expect VMW to beat the consensus estimates for revenues and earnings. The company has reported better than expected revenue and earnings figures in each of the last four quarters. VMW’s revenue growth continued in H1 of FY 2022 led by its Subscription and SaaS segment which saw revenue grow by 26% y-o-y. We expect the segment to drive the third-quarter FY2022 results, as well.

Is VMware a hybrid cloud?

Indeed, VMware is powered by non-cyclical hybrid cloud adoption tail winds. Yet its revenue growth rates are running around 10% and won’t go much higher anytime soon.

Is VMware a good stock?

VMware has good — but not great — long-term growth prospects. The problem with VMW stock is that it was priced for great long-term growth. This disconnect has caused the shares to be weak over the past several months, despite the stock market’s strength.

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