Thursday, July 23, 2015

Seeking Alpha: EMC Corp Sticking To Its Guns

Right or wrong, EMC (NYSE:EMC) is committed to its path of evolving into a leading provider of "IT-as-a-service". Likewise, the company remains committed to an operating structure that is going to continue to frustrate some investors, as it believes (correctly, in my view) that VMware (NYSE:VMW), Pivotal, and other components are vital to its future strategy.

The problem is that EMC is not delivering all that much right now. Reported margins are unimpressive and the company is on a downward slide in several productivity and inefficiency measurements. I believe that this is a product of the company investing substantial sums today to generate revenue and profits down the line, but I won't deny that there's a strong element of "You gotta just trust me on this..." that does not make for an airtight investment thesis. I continue to believe that EMC is undervalued on relatively modest expectations, but it increasingly looks to me that EMC is at least a year away from being able to deliver the sort of results that will quiet critics and encourage its long-term shareholders.

Follow this link to continue:
EMC Corp Sticking To Its Guns

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