VMWare Inc. (VMW): Today's Featured Technology Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

VMWare ( VMW) pushed the Technology sector higher today making it today's featured technology winner. The sector as a whole closed the day up 0.5%. By the end of trading, VMWare rose $3.73 (4.6%) to $85.10 on heavy volume. Throughout the day, 5.9 million shares of VMWare exchanged hands as compared to its average daily volume of 2.9 million shares. The stock ranged in a price between $81.69-$85.25 after having opened the day at $82.21 as compared to the previous trading day's close of $81.37. Other companies within the Technology sector that increased today were: Sigma Designs ( SIGM), up 17.6%, Meade Instruments Corporation ( MEAD), up 16.1%, Oclaro ( OCLR), up 9.6%, and Bazaarvoice ( BV), up 9.3%.
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VMware, Inc. provides virtualization infrastructure solutions in the United States and internationally. VMWare has a market cap of $9.66 billion and is part of the computer software & services industry. The company has a P/E ratio of 43.8, above the S&P 500 P/E ratio of 17.7. Shares are down 13.6% year to date as of the close of trading on Wednesday. Currently there are 16 analysts that rate VMWare a buy, no analysts rate it a sell, and 16 rate it a hold.

TheStreet Ratings rates VMWare as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in net income, growth in earnings per share and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the negative front, VirnetX ( VHC), down 27.8%, Suntech Power Holdings ( STP), down 19.3%, Superconductor Technologies ( SCON), down 16.3%, and Velti ( VELT), down 14.2%, were all laggards within the technology sector with SunPower Corporation ( SPWR) being today's technology sector laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the technology sector could consider Technology Select Sector SPDR ( XLK) while those bearish on the technology sector could consider ProShares Ultra Short Technology ( REW).

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