Vmware Inc (VMW) Fundamental Analysis & Valuation

NYSE:VMW • US9285634021

Current stock price

142.48 USD
-7.43 (-4.96%)
At close:
143 USD
+0.52 (+0.36%)
Pre-Market:

This VMW fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

8

1. VMW Profitability Analysis

1.1 Basic Checks

  • In the past year VMW was profitable.
  • In the past year VMW had a positive cash flow from operations.
  • In the past 5 years VMW has always been profitable.
  • Each year in the past 5 years VMW had a positive operating cash flow.
VMW Yearly Net Income VS EBIT VS OCF VS FCFVMW Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 2B 4B 6B

1.2 Ratios

  • With an excellent Return On Assets value of 4.43%, VMW belongs to the best of the industry, outperforming 82.92% of the companies in the same industry.
  • The Return On Equity of VMW (55.99%) is better than 97.86% of its industry peers.
  • VMW has a Return On Invested Capital of 7.86%. This is amongst the best in the industry. VMW outperforms 85.05% of its industry peers.
  • VMW had an Average Return On Invested Capital over the past 3 years of 9.40%. This is in line with the industry average of 11.09%.
Industry RankSector Rank
ROA 4.43%
ROE 55.99%
ROIC 7.86%
ROA(3y)5.88%
ROA(5y)10.66%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)9.4%
ROIC(5y)10.41%
VMW Yearly ROA, ROE, ROICVMW Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 0 100 -100 200 -200

1.3 Margins

  • VMW has a better Profit Margin (10.48%) than 84.70% of its industry peers.
  • In the last couple of years the Profit Margin of VMW has grown nicely.
  • VMW's Operating Margin of 14.00% is amongst the best of the industry. VMW outperforms 84.70% of its industry peers.
  • In the last couple of years the Operating Margin of VMW has declined.
  • VMW has a Gross Margin of 81.19%. This is amongst the best in the industry. VMW outperforms 86.83% of its industry peers.
  • In the last couple of years the Gross Margin of VMW has remained more or less at the same level.
Industry RankSector Rank
OM 14%
PM (TTM) 10.48%
GM 81.19%
OM growth 3Y2.65%
OM growth 5Y-7.92%
PM growth 3Y-45.05%
PM growth 5Y3.26%
GM growth 3Y-0.79%
GM growth 5Y-0.97%
VMW Yearly Profit, Operating, Gross MarginsVMW Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40 60 80

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3

2. VMW Health Analysis

2.1 Basic Checks

  • VMW has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
  • The number of shares outstanding for VMW has been increased compared to 1 year ago.
  • The debt/assets ratio for VMW has been reduced compared to a year ago.
VMW Yearly Shares OutstandingVMW Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 100M 200M 300M 400M
VMW Yearly Total Debt VS Total AssetsVMW Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 10B 20B 30B

2.2 Solvency

  • VMW has an Altman-Z score of 1.85. This is not the best score and indicates that VMW is in the grey zone with still only limited risk for bankruptcy at the moment.
  • With a Altman-Z score value of 1.85, VMW perfoms like the industry average, outperforming 48.40% of the companies in the same industry.
  • The Debt to FCF ratio of VMW is 2.25, which is a good value as it means it would take VMW, 2.25 years of fcf income to pay off all of its debts.
  • VMW has a Debt to FCF ratio of 2.25. This is in the better half of the industry: VMW outperforms 73.67% of its industry peers.
  • VMW has a Debt/Equity ratio of 3.73. This is a high value indicating a heavy dependency on external financing.
  • With a Debt to Equity ratio value of 3.73, VMW is not doing good in the industry: 87.19% of the companies in the same industry are doing better.
  • Even though the debt/equity ratio score it not favorable for VMW, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
Industry RankSector Rank
Debt/Equity 3.73
Debt/FCF 2.25
Altman-Z 1.85
ROIC/WACC0.77
WACC10.18%
VMW Yearly LT Debt VS Equity VS FCFVMW Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 0 2B 4B 6B 8B 10B

2.3 Liquidity

  • A Current Ratio of 0.87 indicates that VMW may have some problems paying its short term obligations.
  • The Current ratio of VMW (0.87) is worse than 82.56% of its industry peers.
  • VMW has a Quick Ratio of 0.87. This is a bad value and indicates that VMW is not financially healthy enough and could expect problems in meeting its short term obligations.
  • VMW has a worse Quick ratio (0.87) than 81.49% of its industry peers.
Industry RankSector Rank
Current Ratio 0.87
Quick Ratio 0.87
VMW Yearly Current Assets VS Current LiabilitesVMW Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2B 4B 6B 8B 10B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. VMW Growth Analysis

3.1 Past

  • VMW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.90%.
  • Measured over the past 5 years, VMW shows a small growth in Earnings Per Share. The EPS has been growing by 4.63% on average per year.
  • VMW shows a small growth in Revenue. In the last year, the Revenue has grown by 3.56%.
  • The Revenue has been growing by 11.17% on average over the past years. This is quite good.
EPS 1Y (TTM)3.9%
EPS 3Y0.31%
EPS 5Y4.63%
EPS Q2Q%11.59%
Revenue 1Y (TTM)3.56%
Revenue growth 3Y7.28%
Revenue growth 5Y11.17%
Sales Q2Q%2.16%

3.2 Future

  • Based on estimates for the next years, VMW will show a small growth in Earnings Per Share. The EPS will grow by 7.04% on average per year.
  • VMW is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.40% yearly.
EPS Next Y9.9%
EPS Next 2Y12.07%
EPS Next 3Y8.72%
EPS Next 5Y7.04%
Revenue Next Year4.52%
Revenue Next 2Y5.39%
Revenue Next 3Y5.55%
Revenue Next 5Y8.4%

3.3 Evolution

  • The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
  • The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
VMW Yearly Revenue VS EstimatesVMW Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 5B 10B 15B 20B 25B
VMW Yearly EPS VS EstimatesVMW Yearly EPS VS EstimatesYearly EPS VS Estimates 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 5 10 15

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Find the best growth stocksShow best growing peers

6

4. VMW Valuation Analysis

4.1 Price/Earnings Ratio

  • VMW is valuated rather expensively with a Price/Earnings ratio of 20.59.
  • 85.77% of the companies in the same industry are more expensive than VMW, based on the Price/Earnings ratio.
  • Compared to an average S&P500 Price/Earnings ratio of 26.51, VMW is valued a bit cheaper.
  • With a Price/Forward Earnings ratio of 17.40, VMW is valued on the expensive side.
  • Based on the Price/Forward Earnings ratio, VMW is valued cheaper than 85.41% of the companies in the same industry.
  • The average S&P500 Price/Forward Earnings ratio is at 21.41. VMW is around the same levels.
Industry RankSector Rank
PE 20.59
Fwd PE 17.4
VMW Price Earnings VS Forward Price EarningsVMW Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VMW indicates a rather cheap valuation: VMW is cheaper than 85.41% of the companies listed in the same industry.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of VMW indicates a rather cheap valuation: VMW is cheaper than 92.53% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 13.2
EV/EBITDA 20.29
VMW Per share dataVMW EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 -10 20 30

4.3 Compensation for Growth

  • The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates VMW does not grow enough to justify the current Price/Earnings ratio.
  • VMW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.08
PEG (5Y)4.45
EPS Next 2Y12.07%
EPS Next 3Y8.72%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

0

5. VMW Dividend Analysis

5.1 Amount

  • No dividends for VMW!.
Industry RankSector Rank
Dividend Yield N/A

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Find the best dividend stocksShow peers with best dividend

VMW Fundamentals: All Metrics, Ratios and Statistics

Vmware Inc

NYSE:VMW (11/21/2023, 8:04:00 PM)

Premarket: 143 +0.52 (+0.36%)

142.48

-7.43 (-4.96%)

Chartmill FA Rating
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Industry Strength6.83
Industry Growth85.71
Earnings (Last)11-30
Earnings (Next)02-29
Inst Owners0.21%
Inst Owner Change0%
Ins Owners0.31%
Ins Owner Change0%
Market Cap61.52B
Revenue(TTM)13.61B
Net Income(TTM)1.43B
Analysts53.33
Price Target169.22 (18.77%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.18%
Min EPS beat(2)-5.43%
Max EPS beat(2)5.79%
EPS beat(4)2
Avg EPS beat(4)0.57%
Min EPS beat(4)-7.68%
Max EPS beat(4)9.61%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-2.31%
Min Revenue beat(2)-2.35%
Max Revenue beat(2)-2.27%
Revenue beat(4)1
Avg Revenue beat(4)-2.07%
Min Revenue beat(4)-5%
Max Revenue beat(4)1.34%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)0%
PT rev (3m)9.94%
EPS NQ rev (1m)0%
EPS NQ rev (3m)5.95%
EPS NY rev (1m)0%
EPS NY rev (3m)2.55%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.35%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.66%
Valuation
Industry RankSector Rank
PE 20.59
Fwd PE 17.4
P/S 4.52
P/FCF 13.2
P/OCF 12.08
P/B 24.15
P/tB N/A
EV/EBITDA 20.29
EPS(TTM)6.92
EY4.86%
EPS(NY)8.19
Fwd EY5.75%
FCF(TTM)10.8
FCFY7.58%
OCF(TTM)11.79
OCFY8.28%
SpS31.52
BVpS5.9
TBVpS-17.18
PEG (NY)2.08
PEG (5Y)4.45
Graham Number0 (-100%)
Profitability
Industry RankSector Rank
ROA 4.43%
ROE 55.99%
ROCE 9.79%
ROIC 7.86%
ROICexc 12.08%
ROICexgc 56.72%
OM 14%
PM (TTM) 10.48%
GM 81.19%
FCFM 34.25%
ROA(3y)5.88%
ROA(5y)10.66%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)9.4%
ROIC(5y)10.41%
ROICexc(3y)12.19%
ROICexc(5y)13.94%
ROICexgc(3y)39.61%
ROICexgc(5y)182.58%
ROCE(3y)11.7%
ROCE(5y)12.97%
ROICexgc growth 3Y-2.41%
ROICexgc growth 5YN/A
ROICexc growth 3Y8.25%
ROICexc growth 5Y-17.26%
OM growth 3Y2.65%
OM growth 5Y-7.92%
PM growth 3Y-45.05%
PM growth 5Y3.26%
GM growth 3Y-0.79%
GM growth 5Y-0.97%
F-Score6
Asset Turnover0.42
Health
Industry RankSector Rank
Debt/Equity 3.73
Debt/FCF 2.25
Debt/EBITDA 2.95
Cap/Depr 32.82%
Cap/Sales 3.16%
Interest Coverage 6.23
Cash Conversion 158.38%
Profit Quality 326.93%
Current Ratio 0.87
Quick Ratio 0.87
Altman-Z 1.85
F-Score6
WACC10.18%
ROIC/WACC0.77
Cap/Depr(3y)34.45%
Cap/Depr(5y)34.05%
Cap/Sales(3y)3.06%
Cap/Sales(5y)2.88%
Profit Quality(3y)236.48%
Profit Quality(5y)194.34%
High Growth Momentum
Growth
EPS 1Y (TTM)3.9%
EPS 3Y0.31%
EPS 5Y4.63%
EPS Q2Q%11.59%
EPS Next Y9.9%
EPS Next 2Y12.07%
EPS Next 3Y8.72%
EPS Next 5Y7.04%
Revenue 1Y (TTM)3.56%
Revenue growth 3Y7.28%
Revenue growth 5Y11.17%
Sales Q2Q%2.16%
Revenue Next Year4.52%
Revenue Next 2Y5.39%
Revenue Next 3Y5.55%
Revenue Next 5Y8.4%
EBIT growth 1Y-16.59%
EBIT growth 3Y10.12%
EBIT growth 5Y2.37%
EBIT Next Year34.25%
EBIT Next 3Y19.61%
EBIT Next 5YN/A
FCF growth 1Y13.1%
FCF growth 3Y2.33%
FCF growth 5Y5.43%
OCF growth 1Y14.56%
OCF growth 3Y3.56%
OCF growth 5Y5.97%

Vmware Inc / VMW Fundamental Analysis FAQ

What is the ChartMill fundamental rating of Vmware Inc (VMW) stock?

ChartMill assigns a fundamental rating of 5 / 10 to VMW.


What is the valuation status for VMW stock?

ChartMill assigns a valuation rating of 5 / 10 to Vmware Inc (VMW). This can be considered as Fairly Valued.


How profitable is Vmware Inc (VMW) stock?

Vmware Inc (VMW) has a profitability rating of 8 / 10.


Can you provide the PE and PB ratios for VMW stock?

The Price/Earnings (PE) ratio for Vmware Inc (VMW) is 20.59 and the Price/Book (PB) ratio is 24.15.


Is the dividend of Vmware Inc sustainable?

The dividend rating of Vmware Inc (VMW) is 0 / 10 and the dividend payout ratio is 0%.