Market Update: EMC Corporation (NYSE:EMC) – VMware Surges 10%: Q2 View Beats, Sets $1.2B Buyback

[at Barrons.com] – Virtualization software pioneer VMware (VMW), which is in the process of a complicated recapitalization action by Dell and VMware’s corporate parent, EMC (EMC), this afternoon reported Q1 revenue in-line with analysts’ expectations and earnings per share that topped consensus, authorized a share repurchase plan for up to $1.2 billion in buybacks this year. The company’s board of directors authorized $1.2 billion this year, VMware said. CFO Zane Rowe said of the plan, Our intent to repurchase $1.2 billion of stock this year underscores the confidence we have in the business and reinforces our capital allocation strategy, which includes returning capital to shareholders.” CEO Pat Gelsinger said the quarter had been “a good start to 2016,” with “solid progress with our strategic goal of building momentum for our newer growth businesses and in the cloud.” Added Gelsinger, “We continue to see momentum across our portfolio of growth products and businesses, including NSX, Virtual SAN and End-User Computing.” VMware management will host a conference call with analysts this evening, at 5 pm, Eastern time, and you can catch the call via a webcast on the company’s investor relations home page. Read more on this. EMC Corporation (EMC) , valued at $49.90B, opened this morning at $25.44. A quick look at the market, the company’s stock traded between $25.44 and $25.77 with the price of the stock fluctuating between $22.66 to $28.77 over the last 52 weeks. EMC shares are currently priced at 13.59x this year’s forecasted earnings, which makes them relatively expensive compared to the industry’s 10.01x earnings multiple. The company pays shareholders $0.46 per share in dividend income per year, for a current yield of 1.80%. According to a consensus of 29 analysts, the earnings estimate of $0.33 per share would be $0.02 better than the year-ago quarter and a $0.02 sequential decrease. In looking at the bigger picture, the full-year EPS estimate of $1.88 would be a $0.06 better when compared to the previous year’s annual results. The quarterly earnings estimate is based on a consensus revenue forecast of the current quarter of $5.64 Billion. If realized, that would be a 0.53% increase over the year-ago quarter. More recently, Raymond James downgraded EMC from Strong Buy to Outperform (Apr 7, 2016). Previously, Maxim Group upgraded EMC from Hold to Buy. With the above information in mind, readers should note that the average price target is $28.40, which is 11.64% above where the stock opened this morning. See more in (NYSE:EMC) Similar Articles: Market Update: Microsoft Corporation (NASDAQ:MSFT) – Microsoft beats Wall Street view on high demand for cloud products Stock Update: EMC Corporation (NYSE:EMC) – VMware’s a Value, Says Jefferies; What Other Choice Is There? Asks Bernstein Company Update (NYSE:EMC): EMC and VMware Reveal New Cloud Services Business