VMware Inc. (VMW, Financial), a provider of virtualization and cloud infrastructure solutions, will report its financial results for the second quarter of fiscal 2018 after the market closes on Aug. 24.
The preliminary results were announced Aug. 14.
For the second quarter, VMware expects to report non-GAAP diluted EPS of $1.15 to $1.19. This range represents a 18.6% to 22.7% increase from 97 cents reported in the year-ago quarter.
Analysts expect VMware will close the quarter meeting the lower limit of its EPS guidance, as shown in the chart below.
Source: Yahoo Finance
For the earnings estimate of $1.15, 32 analysts were surveyed. They expect revenue to come in at $1.88 billion on average.
Source: Yahoo Finance
In its preliminary results, VMware provided its expectations on revenue, ranging from a minimum of $1.894 billion and a maximum of $1.906 billion. This range represents an 11.9% to 12.6% increase from $1.6 billion in second-quarter 2017.
In its earnings report, the company will also provide an outlook for full fiscal 2018. The company has already increased its expectations for revenue, margins and earnings due “to strong performance in the second quarter of fiscal 2018 and continued broad-based strength across its product portfolio expected in the second half of fiscal 2018."
Financially, VMware has a strong balance sheet with approximately $8.61 billion in cash and securities as of the most recent quarter. Total debt is $1.5 billion, which leads to a total debt-equity ratio of 18.59 versus an industry average of 21.39. This means the company is less leveraged than its peers.
GuruFocus gives VMware a financial strength rating of 7 out of 10 and a profitability and growth rating of 9 out of 10.
VMware is currently trading around $97.01 per share with a market capitalization of $39.74. The price-book (P/B) ratio is 4.88, the price-sales (P/S) ratio is 5.64, the price-earnings (P/E) ratio is 32.74, the forward P/E ratio is 17.80 and the EV/Ebitda ratio is 17.18.
Disclosure: I have no positions in VMware Inc.
