03.12.2019 shares were sold at the price of SL $150. The investment idea brought 2.55% return in 69 days.


Ticker: VMW
Buy: market ($146.19)
Take profit: $185
Stop-Loss: $123
Updated Stop-Loss: $150 (28.10.19). Stop-Loss is shifted to breakeven.

VMware (NYSE: VMW) – American company, the largest softer developer for virtualization, founded in 1998 with Headquarters in Palo-Alto, CA, USA

In a Q2, VMware announced about two major acquisitions:
  • Carbon Black (Nasdaq: CBLK) – cybersecurity field of expertise. Developing could storage solutions aiming to detect unverified activity on the web. Among more than 5000 clients, there are such companies as DocuSign (Nasdaq: DOCU), Evernote, Adobe (Nasdaq: ADBE).
  • Pivotal Software (NYSE: PVTL) – the company building infrastructure for the development of scaling software products and applications. Major company’s clients are Boeing (NYSE: BA), Bloomberg, Orange (EPA: ORA), T-Mobile (Nasdaq: TMUS), Ford (NYSE: F).

We assume that such strategic acquisitions will lead to synergetic effect. After integration of the companies VMware clients will be able use a full pack solution for secure virtualization and scaling of software infrastructure. Moreover, VMware will enlarge customer base with some big names in it.

Financial indicators: Q2 2019:

  • During the second quarter VMware performed a $2.44 billion revenue, which is 12% higher comparing with same period last year.
  • Revenue from licence sales was more than $1.1 billion, 12.3% more than last year for the same timeframe.
  • Revenue from services offered was $1.43 billion, 12.1% more than last year for the same timeframe.

Financial statements illustrate revenue increase higher than the market expectations were.

Through our analysis we consider that correction, which was a result from acquisition activity, is finished now. And for the moment company’s stock price will benefit from boosted financial performance.

Technical Analysis



Correction started in May ’19 was more than 35%, what is deep enough for the renewal of upward trend.

Correction bottomed at $129 p/share – January ’19 levels.

SMMA 100 on the weekly graph suppressed the downfall at $130 p/share


Correction from the last movements was less than 50%, therefore there is a possibility to go back to the level of $120- $125 p/share.

SMMA 50 indicator on the weekly graph is equal to the current value of the share, which could prevent the upcoming rally.


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