Vmware Inc (VMW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:VMW - US9285634021 - Common Stock
142.48 USD
-7.43 (-4.96%)
143 USD
+0.52 (+0.36%)
We assign a fundamental rating of 5 out of 10 to VMW. VMW was compared to 278 industry peers in the Software industry. VMW scores excellent on profitability, but there are concerns on its financial health. VMW is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year VMW was profitable.
In the past year VMW had a positive cash flow from operations.
Each year in the past 5 years VMW has been profitable.
In the past 5 years VMW always reported a positive cash flow from operatings.
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.
VMW has a Return On Equity of 55.99%. This is amongst the best in the industry. VMW outperforms 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 10.78%.
| Industry Rank | Sector 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%
1.3 Margins
The Profit Margin of VMW (10.48%) is better than 84.70% of its industry peers.
VMW's Profit Margin has improved in the last couple of years.
VMW has a better Operating Margin (14.00%) than 84.70% of its industry peers.
In the last couple of years the Operating Margin of VMW has declined.
VMW has a better Gross Margin (81.19%) than 86.83% of its industry peers.
VMW's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector 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%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so VMW is destroying value.
VMW has more shares outstanding than it did 1 year ago.
The number of shares outstanding for VMW has been increased compared to 5 years ago.
VMW has a better debt/assets ratio than last year.
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.
Looking at the Altman-Z score, with a value of 1.85, VMW is in line with its industry, outperforming 48.40% of the companies in the same industry.
VMW has a debt to FCF ratio of 2.25. This is a good value and a sign of high solvency as VMW would need 2.25 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.25, VMW is doing good in the industry, outperforming 73.67% of the companies in the same industry.
VMW has a Debt/Equity ratio of 3.73. This is a high value indicating a heavy dependency on external financing.
VMW's Debt to Equity ratio of 3.73 is on the low side compared to the rest of the industry. VMW is outperformed by 87.19% of its industry peers.
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 Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.73 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 1.85 |
ROIC/WACC0.77
WACC10.18%
2.3 Liquidity
A Current Ratio of 0.87 indicates that VMW may have some problems paying its short term obligations.
VMW has a worse Current ratio (0.87) 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.
Looking at the Quick ratio, with a value of 0.87, VMW is doing worse than 81.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.87 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
VMW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.90%.
The Earnings Per Share has been growing slightly by 4.63% on average over the past years.
The Revenue has been growing slightly by 3.56% in the past year.
VMW shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.17% yearly.
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
The Earnings Per Share is expected to grow by 7.04% on average over the next years.
Based on estimates for the next years, VMW will show a quite strong growth in Revenue. The Revenue will grow by 8.40% on average per year.
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
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
VMW is valuated rather expensively with a Price/Earnings ratio of 20.59.
Based on the Price/Earnings ratio, VMW is valued cheaply inside the industry as 85.77% of the companies are valued more expensively.
VMW's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.39.
VMW is valuated rather expensively with a Price/Forward Earnings ratio of 17.40.
VMW's Price/Forward Earnings ratio is rather cheap when compared to the industry. VMW is cheaper than 85.41% of the companies in the same industry.
VMW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.84.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.59 | ||
| Fwd PE | 17.4 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, VMW is valued cheaper than 85.41% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, VMW is valued cheaply inside the industry as 92.53% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.2 | ||
| EV/EBITDA | 20.29 |
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.
The excellent profitability rating of VMW may justify a higher PE ratio.
PEG (NY)2.08
PEG (5Y)4.45
EPS Next 2Y12.07%
EPS Next 3Y8.72%
5. Dividend
5.1 Amount
VMW does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
142.48
-7.43 (-4.96%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
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 Rank | Sector 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 Rank | Sector 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 NumberN/A
Profitability
| Industry Rank | Sector 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 Rank | Sector 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 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 of Vmware Inc (VMW) stock?
ChartMill assigns a valuation rating of 5 / 10 to Vmware Inc (VMW). This can be considered as Fairly Valued.
What is the profitability of VMW stock?
Vmware Inc (VMW) has a profitability rating of 8 / 10.
Can you provide the financial health for VMW stock?
The financial health rating of Vmware Inc (VMW) is 3 / 10.
Can you provide the dividend sustainability for VMW stock?
The dividend rating of Vmware Inc (VMW) is 0 / 10 and the dividend payout ratio is 0%.