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VMware (VMW) closed at $131.72 in the latest trading session, marking a +0.5% move from the prior day. This change outpaced the S&P 500's 0.37% loss on the day.
Heading into today, shares of the cloud computing company had gained 8.81% over the past month, outpacing the Computer and Technology sector's loss of 8.73% and the S&P 500's loss of 6.01% in that time.
VMware will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.97, down 10.86% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $3.52 billion, up 6.92% from the year-ago period.
Any recent changes to analyst estimates for VMware should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. VMware is currently a Zacks Rank #3 (Hold).
Digging into valuation, VMware currently has a Forward P/E ratio of 17.93. Its industry sports an average Forward P/E of 33.2, so we one might conclude that VMware is trading at a discount comparatively.
Meanwhile, VMW's PEG ratio is currently 1.42. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Computer - Software industry currently had an average PEG ratio of 2.68 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 153, putting it in the bottom 40% 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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VMware, Inc. (VMW) : Free Stock Analysis Report
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