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 Computer Software & Services industry lower today making it today's featured Computer Software & Services laggard. The industry as a whole closed the day up 0.7%. By the end of trading, VMWare fell $0.92 (-1.3%) to $71.50 on heavy volume. Throughout the day, 7,561,032 shares of VMWare exchanged hands as compared to its average daily volume of 2,567,900 shares. The stock ranged in price between $69.60-$73.47 after having opened the day at $72.73 as compared to the previous trading day's close of $72.42. Other companies within the Computer Software & Services industry that declined today were:
Kingtone Wirelessinfo Solution (
KONE), down 16.7%,
China Mobile Games and Entertainment Group (
CMGE), down 9.1%,
Wireless Ronin Technologies (
RNIN), down 7.3% and
BOS Better Online Solutions (
BOSC), down 4.8%.
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VMware, Inc. provides virtualization infrastructure solutions in the United States and internationally. VMWare has a market cap of $9.4 billion and is part of the technology sector. The company has a P/E ratio of 43.6, above the S&P 500 P/E ratio of 17.7. Shares are down 22.2% year to date as of the close of trading on Wednesday. Currently there are 14 analysts that rate VMWare a buy, 2 analysts rate it a sell, and 14 rate it a hold.
TheStreet Ratings rates
VMWare as a
buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
On the positive front,
Zix Corporation (
ZIXI), down 7.1%,
Netsol Technologies (
NTWK), down 6.3%,
Descartes Systems Group (
DSGX), down 6.1% and
Park City Group (
PCYG), down 5.6% , were all gainers within the computer software & services industry with
Adobe Systems (
ADBE) being today's featured computer software & services industry leader.
For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the computer software & services industry could consider
iShares S&P NA Tech Software Idx (
IGV) while those bearish on the computer software & services industry could consider
ProShares Ultra Short Technology (
REW).
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