VMWare Drops Further After Round of Analyst Downgrades
Shares of VMWare (NASDAQ: VMW) dropped in aftermarket trading on Monday after the company reported earnings and offered guidance. Shares were down as much as 13 percent in Monday's after-hour session, but plunged further Tuesday morning (more than 18 percent) following a round of analyst downgrades:
- Sterne Agee downgraded to Neutral
- Wunderlich downgraded to Hold, lowered price target to $75.
- Piper Jaffray downgraded to Neutral, lowered price target to $90.
- Topeka Capital downgraded to Hold, $84 price target.
- Credit Suisse maintained Outperform, lowered price target to $110.
- Deutsche Bank maintained Buy, lowered price target to $110.
- BMO maintained Market Perform, lowered price target to $85.
- Goldman Sachs removed from Conviction Buy list, but maintained Buy rating.
- Morgan Stanley downgraded to Equalweight.
VMWare initially dropped after the company guided fiscal year 2013 sales $5.23-5.35 billion, less than the $5.42 billion analysts were anticipating. The company also guided first quarter sales $1.17-1.19 billion, less than the $1.25 billion that was anticipated. In addition, it announced that it would shed 900 jobs.
For the fourth quarter, VMWare reported better than expected top and bottom line figures. VMWare posted a fourth quarter EPS of $0.81, more than the anticipated $0.78. Revenue came in at $1.29 billion, slightly more than the $1.28 billion that was anticipated.
Shares of VMWare traded near $80 in the pre-market on Tuesday.
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