Ask YC: Is VMWare a good buy? | Hacker News Reader

Ask YC: Is VMWare a good buy?

3 pointsjmatt5 comments

VMW (http://finance.google.com/finance?q=NYSE:VMW) has dropped approximately 25% since the CEO left or was ousted. On top of that it is down from it's high of 125.25. Is it a good buy at approximately $39 a share? I've used VMWare Fusion and have been really pleased. I think they currently hold an advantage because they support so many different operating systems. In the coming years Virtualization is going to happen, will VMW end up being a good investment? Will Xen and Parellels end up taking market share from Microsoft and VMWare? I think it's an interesting topic which may end up being hard to predict. What does Hacker News think?

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They're trading at over sixty times their highest-ever earnings. I guess you have to wonder why, if virtualization is able to earn them such great returns, they don't have more competition.

My guess is that their product will get cheaper and more commoditized, and those 15% profit margins won't last. But I don't know much about the industry -- that's just what happens in tech, in general.

I don't think it's a good buy personally.

Good product, but there are too many free options out there, and a lot of general turmoil in the virtualization space right now.

On the linux side of things, Virtualbox is a much better product than VMWare except for some issues with giving control of USB devices to the VM. It loads faster, and has a coherence mode similar to VMWare Fusion on Mac.

The free solutions are getting much better and can compete with VMWare. Furthermore, I would say the money is not in desktop virtualization, but rather in server virtualization. For this, does VMWare even have a product?

> The free solutions are getting much better and can compete with VMWare. Furthermore, I would say the money is not in desktop virtualization, but rather in server virtualization. For this, does VMWare even have a product?

Huh? They are extremely strong in data center virtualization - in fact that's where their main revenue comes from: http://www.vmware.com/products/server_virtualization.html

no. not yet, at least. their P/E was astronomical before, and its still kinda high. will need to drop more before i consider a purchase, myself. if it dips below $20, i'd consider it.

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