VMWare Drops Further After Round of Analyst Downgrades

Shares of VMWare

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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