VMware's VMworld Called Snooze; Will New Parent Dell Inject Life?

(VMW) annual fair VMware VMworld this week not wow investors or analysts, but saw some good things, but Dell is about to become the mother of cloud computing company.

VMware is EMC storage systems giant (EMC), which, after a long process is about to complete its merger with majority-owned giant Dell calculation. the acquisition of the company by Dell maintained EMC is set to close on Wednesday. Under the terms, shareholders will receive $ 24.05 EMC per share plus shares of a new tracking stock for the majority stake in VMware DVMT MCH under the new ticker.

"The VMW Management said they expect a tailwind alliance w / Dell Dell and more than 20,000 sales representatives are now preferred VMW" wrote UBS analyst Brent Thill of in a research note Thursday.

Dell, always one of the major PC manufacturers, was denied in 2013 by founder Michael Dell and Silver Lake Partners private equity investors.

Taking IBD: VMware is by far the No. 1 company in the enterprise software group specializing in IBD, by market capitalization, and the group has been on the roll. It is number 15 of the 197 groups, against 78th there are only eight weeks. The best actions are often in the best groups. So how the group jump so fast? You can find information on the best groups in the column of IBD Topics Industry.

Thill raised its price target on the VMware stock to 83 of 77 and maintained a buy recommendation.

"If not well were big product announcements (at VMworld), it is clear VMW focuses its efforts to become a layer of management for multicloud environments, with new services cross into the cloud," he said.

VMware stock rose 0.6% at the close of the stock market today, at 73.78, making it almost even for the week of VMworld.

The company unveiled its history ahead on Monday, introducing its commitment to cloud services to expand its strategy / public and private cloud and hybrid work designed with Amazon.com major cloud service (AMZN), alphabet (GOOGL) Google, Microsoft (MSFT) and IBM (IBM). He also announced the Cloud Foundation, which makes storage, networking and virtualization into a single package, and makes it available as a cloud service hosted by IBM.

Other analysts were less enthusiastic than Thill, noting that the company has not updated its financial forecasts, as it has done in the past in this event.

"Overall, we are warming to the VMware story, but maintain our Market Perform given what appears to us as a risk / reward more or less neutral on valuation," wrote William Blair analyst Jason Ader in a Thursday report.

Pacific Crest Securities maintains a classification of sector weight VMware securities.

"We believe investors are likely to divert VMworld greatly impressed measure given the lack of major announcements or additional financial data," the Pacific Crest analysts wrote in their research note Wednesday.

Other analysts were less enthusiastic than Thill, and they noted that the company did not update its financial guidance, as it has in the past at this event.

"Overall, we are warming up to the VMware story, but maintain our Market Perform rating given what looks to us as a roughly neutral risk/reward profile on valuation," William Blair analyst Jason Ader wrote in a research report Thursday.

Pacific Crest Securities maintains a sector weight rating on VMware stock.

"We believe investors are likely to walk away from VMworld largely unimpressed given a lack of major announcements and no incremental financial data," Pacific Crest analysts wrote in their research note late Wednesday.