Have VMware(VMW) - Get Report investors gone crazy? Shares of the virtualization and cloud infrastructure solutions provider are up a staggering 96% in the latest 52-week period, and 12% just this year.

This time last year, shares of VMware were in a virtual world of hurt. The company was reeling after a series of quarterly misses and guidance cuts. Then, last January, the chief financial officer left the company. The stock hit rock bottom in early February and looked like it would never get out of its downward spiral.

It took until July for the company to get its act together. After the July earnings release, investors felt comfortable buying the stock again and VMW began its climb in earnest.

Last week, VMware reported fourth-quarter and full-year 2016 results. Fourth-quarter earnings of $1.43 per share, were $0.03 better than expected. Revenue rose 8.8%, year to year, to $2.03 billion, and compared to the $1.99 billion estimate. License revenue grew 7.5% and services were up 9.8%.

In the fourth quarter, VmWare had a record number of large deals, landing 13 of greater $10 million.

NSX and vSAN are VMware's hit products. NSX allows the virtualization of whole networks in software. The vSAN product allows IT administrators to create virtual software area defined storage networks. Both save customers money by helping them avoid the expense of buying more servers or storage hardware.

NSX customers have grown to more than 2,400, almost double last year's count and license bookings in the fourth quarter rose more than 50% year over year.

vSAN license bookings increased 150% in the fourth quarter and the number of customers to over 7,000, more than doubling year over year.

For the full year, VMWare's total revenue grew 7% to $7.09 billion. Non-GAAP net income per diluted share was $4.39.

Going forward, analysts see first-quarter fiscal year 2018 revenue of $1.7 billion, up 7.3%. License revenue is expected to climb 6.4% and service revenue nearly 8%. Analysts are looking for first-quarter EPS of $0.96.

(Note: Because of the acquisition of EMC by Dell(DELL) - Get Report , VMware is adopting Dell's fiscal year, essentially skipping fiscal 2017 and moving to fiscal 2018. VMware is expected to report first-quarter fiscal 2018 on April 18. VMW is majority owned by EMC.)

Even though the stock is up more than 90% in the last year, the company continues to aggressively repurchase its shares. The board of directors has authorized the buyback of up to $1.2 billion of stock through 2018. This is in addition to the ongoing $500 million buyback program announced in December 2016.

For fiscal 2018, the consensus is looking for revenue of $7.5 billion and EPS of $4.87.

Software companies trade between 18 and 20 times forward earnings estimates, so VMW likely has a few more points of upside (say $92-97).

Management seems to think the company should be viewed as a cloud play (and earn a higher cloud multiple), but VMware ended the fourth quarter with just 8% of revenue from the cloud.

Despite all the hype, VMware only has single-digit revenue growth (6-7%), so, in my opinion, it doesn't deserve a cloud-like multiple (25-30 times).

To me, paying more for VMW is virtual insanity.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.