Buying large-cap tech can be tricky, as investors are unforgiving in their demands for growth. I have long liked EMC (NYSE:EMC)
and regarded it as a long-term play on the evolving enterprise IT
world, but owning these shares has offered no particular boost to my
portfolio returns.
I continue to believe that EMC is undervalued
and that growth-oriented businesses like NSX, Pivotal, XtremeIO, and
Airwatch offer good potential. I also think that ownership/control of VMware (NYSE:VMW)
is an asset and not a drawback as some believe. That said, there are
real questions as to whether the changes in traditional storage markets
will take away growth faster than these new ventures can add it back. An
acquisition offer from another enterprise player like Hewlett-Packard (NYSE:HPQ), Cisco (NASDAQ:CSCO), or Oracle (NYSE:ORCL)
would be an easy exit opportunity, but I suspect that EMC's decision to
stick to its guns regarding its outlook/prospects will make a deal too
hard to reach and force investors to continue to exercise patience to
see this stock deliver adequate returns.
Read more here:
Patience With EMC Has Yet To Pay Off
No comments:
Post a Comment