VMware (VMW) Stock: $177 Price Target From Citi

By Amit Chowdhry ● Nov 25, 2021
  • The shares of VMware, Inc. (NYSE: VMW) have received a price target of $177 from Citi. These are the details.

The shares of VMware, Inc. (NYSE: VMW) have received a price target of $177 from Citi. And Citi analyst Tyler Radke reduced the price target from $190 while maintaining a “Buy” rating on the company shares.

Radke noted that the company’s third-quarter results were again led by material upside in on-premise/license while subscription and software-as-a-service fell slightly below expectations. And Radke believes that the results are unlikely to materially improve near-term sentiment on the shares. But VMware’s current valuation appears undemanding, according to Radke.

These are the results for the company’s third quarter of the fiscal year 2022:

— Revenue for the third quarter was $3.19 billion, an increase of 11% from the third quarter of fiscal 2021.

— The combination of subscription and SaaS and license revenue was $1.53 billion, an increase of 16% from the third quarter of fiscal 2021.

— Subscription and SaaS revenue for the third quarter was $820 million, an increase of 21% year-over-year.

— Subscription and SaaS ARR for the third quarter was $3.31 billion, an increase of 25% year-over-year.

— GAAP net income for the third quarter was $398 million, or $0.94 per diluted share, down 8% per diluted share compared to $434 million, or $1.02 per diluted share, for the third quarter of fiscal 2021. Non-GAAP net income for the third quarter was $725 million, or $1.72 per diluted share, up 3% per diluted share compared to $704 million, or $1.66 per diluted share, for the third quarter of fiscal 2021.

— GAAP operating income for the third quarter was $519 million, an increase of 21% from the third quarter of fiscal 2021. Non-GAAP operating income for the third quarter was $935 million, an increase of 5% from the third quarter of fiscal 2021.

— Operating cash flow for the third quarter was $1.09 billion. Free cash flow for the third quarter was $984 million.

— RPO for the third quarter totaled $11.12 billion, up 9% year-over-year.

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