Why have CommVault shares outperformed EMC's?

This topic was created by Chris Mellor 1 .

Why have CommVault shares outperformed EMC's?

Although CommVault and EMC have both exhibited steadily climbing annual revenues and profits CommVault shares have outperformed EMC's. Why? Are investors and the stock market commentators, analysts and influencers crazy?

A coming story about CommVault's results has charts that show the two company's annual results and their share price movements compared. How is it that their share prices have moved so differently?

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Are investors and the stock market commentators, analysts and influencers crazy?

Yes.

Marketers brainwashing large shareholders have out-weighed sound engineering principles for about fifteen years now. Does anyone with a brain really think Apple is worth it's market cap? What about Google or Facebook?

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Micro and macroeconomics

I took intro to microeconomics and macroeconomics classes in 1999. It was interesting, because the classes taught sound market principles, then I looked at the market and by then it had gone wild for at least the last 5 years. But it was strange, because "by the book" a sound market value for a company is like 6:1 to 12:1 price to earnings (stock price is about 6-12x yearly earnings), maybe 20:1 for something like an old school phone company where there's lots of physical assets. Noone in this class seemed to see the current market (20-50:1 P/E being typical on many stocks in 1999) as a problem, but a sign of a booming economy (even though "by the book" this was a classic bubble.)

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I reckon if CommVault's share price is realistic then EMC is dreadfully under-valued by the market. On the other hand the opposite could be true! I just can't make sense of it.

Chris.

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