3 Reasons Why VMware (VMW) is a Great Momentum Stock

Many investors like to look for an impulse in stocks, but this can be very difficult to define. There is a great debate about which metrics are the best to focus on in this aspect and which are not really indicators of future performance quality. Fortunately, with our new style scoring system, we have identified the key statistics to which we must pay close attention and, therefore, what actions could be the best for momentum investors in the short term.

This method discovered several excellent candidates for impulse-oriented investors, but today we focus on VMware, Inc. (VMW - Free Report) as this action looks especially impressive at this time. And while there are many ways in which this company could be a great option, we have highlighted three of the most important reasons for the status of VMW as a solid momentum below:

Short-term price change for VMware

A great place to look for impulse stocks is by inspecting the short-term price activity. This can help reflect current interest in an action and if buyers or sellers have the advantage at this time. It is especially useful to compare it with the industry, as this can help investors identify the major companies in a particular area.

With a week-long price change of 9.4% compared to an industry average of 2%, VMW is certainly well positioned in this regard. The stock also looks pretty good from a longer time frame, since the four-week price change compares favorably with the industry in general.

Long-term price change for VMware

While any action can see an increase in price, a real winner is needed to constantly beat the market. That is why observing long-term price indicators, such as performance in the last three months or years, and comparing them with an industry in general can be very useful.

And in the case of VMW, the results are quite impressive. The company has beaten the industry in general in the last 12 weeks with a margin of 2.9% to -10.1%, while it has also performed better than last year, representing a gain of 38.4 %. Clearly, VMW is having a good run and it is worthwhile for investors to analyze it more closely.

VMware, Inc. Price

Reviews moving in the right direction

While the large momentum factors described in the preceding paragraphs may be sufficient for some investors, we must also take into account the general trends of revision of earnings estimates. A good road here can really help us show us a promising stock, and we've actually been seeing it with VMW lately.

In the last two months, 12 earnings estimates have risen compared to none lower throughout the year, while we also note that eight estimates have gone up with a downward revision for the next period. These revisions have helped to increase the consensus estimate, since two months ago VMW was expected to publish earnings of $ 6.09 per share for the whole year, although today it seems to have an EPS of $ 6.23 for the whole year, which represents a Solid increase that is something that should be good news for potential investors.

Bottom line

Given these factors, investors should not be surprised to see that we have VMW as a security with a Rank # 2 of Zacks (Purchase) and a Momentum score of A. You can see the complete list of Rank # 1 of Zacks today. (Buy strong) shares here.

So, if you are looking for a new option that has the potential to move in the right direction, definitely keep VMW on your short list, as it seems to be an action that is very well positioned to rise in the short term.

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