VMWare (VMW) is virtualization software that enables one server to do the work of multiple servers including web servers, storage servers, application servers, mail servers and database servers, essentially eliminating the need for these different servers. This reduces vastly, the energy costs that the higher number of servers would otherwise consume, and also reduces the cost of setup, managment and maintainence that all the different servers would require.
VMWare is 90% owned by EMC (EMC) after today. This morning, while VMWare's price shot up 75% above its IPO price (most of you couldn't have bought it under $48 so don't feel too bad), EMC was down. I think any dip in EMC should be bought. Remember, they can sell VMWare shares anytime they want and raise capital.
As for VMWare, chasing the stock in this kind of an environment is not a good idea. If it pulls back to the mid-40's though, it would be worth a look.
-- Faisal Laljee
Full Disclosure: I own EMC but my position can change anytime without notice.
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