As expected, no-moat Dell Technologies (DELL) announced that it will outsource its 81% stake in VMware with a narrow moat (VMW) We believe this spin-off will benefit both companies and shareholders of both companies. We are maintaining our fair value estimates of $ 75 for Dell and $ 202 for VMware until the spin-off is complete, along with our moat valuations for both companies. If all other factors are equal, our fair value estimate for Dell at this point will likely decrease if VMware is spun off, although Dell shareholders will not lose value if they receive additional VMware stock. Our fair value to VMware would likely decrease as well, as it pays a heavy dividend to all shareholders (including Dell) on the exit, but again, VMware shareholders will not lose value here. Regardless, VMware remains undervalued (with stocks rising only marginally after hours) and one of our top picks in the tech space. Dell stocks are up 9% in the news and remain …



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