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$12.57 -0.20 (-1.57%)
7/18/2008 4:01 PM

EMC Corp (EMC)

CAPS Rating:
*****

The Company develops, delivers and supports the Information Technology industry's range of information infrastructure technologies and solutions that are designed to help individuals and organizations handle its digital information needs.

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Avatar skypicks (< 20) Submitted: 4/17/07 3:33 PM : Outperform Start Price: $15.31 EMC Score: -3.63

Too many positives to count. Solid cash flow, balance sheet, and growth. Not spectacular, but the market can't ignore annual growth of 15% forever. Otherwise we will see a private equity takeover. The VMWare IPO will unlock some of the hidden value in EMC.

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Avatar JeanDavid (25.22) Submitted: 5/12/07 10:00 AM

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I do not see how the spin-off of VMWare will help. Why do they really do it anyway? It reminds me of AT&T spinning off NCR (which, IMAO, they never should have bought in the first place), losing billions. AT&T spun off one thing after another to unlock value, and as a result, the AT&T does not really exist anymore (although the brand does). It is like firing all your employees to reduce labor costs. Sure it does that, but
1.) Who will make your product?
2.) Who will buy your product if they have no jobs?

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Avatar skypicks (< 20) Submitted: 5/15/07 12:22 PM

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I think a more appropriate analogy is CY spinning off a piece of SPWR. VMWare is growing much faster than the rest of EMC, but because of the size of EMC that growth is "lost" in the overall numbers. So, EMC is trying to unlock the real value here. In the near term EMC will face some headwinds from the summer tech slowdown and the potential for a recession by year end. The VM Ware IPO is scheduled for sometime in June I think and it should be dragging the EMC stock price higher. I don't think EMC will do a full spin off, this is more about a proper valuation than anything else. EMC should really be trading closer to 20 than 15.

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