What Do Analysts Think of VMware Stock?



Industry analysts continue to be upbeat about VMware’s prospects

Earlier in the series, we discussed the factors that enabled VMware (VMW) stock to surge following its announcement of its fiscal Q1 2019 earnings. Let’s see what industry analysts have to say about VMware’s performance in its most recent quarter.

Credit Suisse Group has given VMware stock an “outperform” rating and has increased its price target on the stock to $155.00 from the previous level of $140.00. KeyBanc Research has also raised its price target on the stock to $160 from $155.

Despite Dell’s potential reverse merger with VMware being an overhang on the latter, VMware’s better-than-expected fiscal Q1 2019 results have made the market much less concerned about the outcome of the deal, and the focus continues to be on VMware’s fundamentals.

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In addition to robust top line growth, VMware is also focused on its margins and free cash flow. Its dominance in the infrastructure software space could get a further boost from its recent initiatives and partnerships with leading cloud players Amazon (AMZN), Microsoft (MSFT), IBM (IBM), and Google (GOOG).

Looking at industry analysts’ ratings on VMware stock, it’s apparent that all these factors have been taken into consideration in their analysis.

Most analysts call VMware stock a “buy”

Of the 35 analysts covering VMware stock, only one has given it a “sell” recommendation. As we can see in the graph above, more than 50% of analysts have recommended “buys” on the stock. The remainder have recommended “holds.”

Wall Street’s consensus target price for VMware was $150.63 per share on June 5. Its median target price was $153.00. VMware’s closing price was $147.03 on the day.


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