Can VMware Meet These Numbers?

VMware (NYSE: VMW  ) is expected to report Q2 earnings on July 23. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict VMware's revenues will grow 9.7% and EPS will grow 13.2%.

The average estimate for revenue is $1.23 billion. On the bottom line, the average EPS estimate is $0.77.

Revenue details
Last quarter, VMware logged revenue of $1.19 billion. GAAP reported sales were 13% higher than the prior-year quarter's $1.06 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.74. GAAP EPS of $0.40 for Q1 were 9.1% lower than the prior-year quarter's $0.44 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 84.7%, 90 basis points better than the prior-year quarter. Operating margin was 18.7%, 190 basis points worse than the prior-year quarter. Net margin was 14.6%, 350 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $5.17 billion. The average EPS estimate is $3.25.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,158 members out of 2,338 rating the stock outperform, and 180 members rating it underperform. Among 471 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 438 give VMware a green thumbs-up, and 33 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on VMware is outperform, with an average price target of $97.70.

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