Dell VMware Spinoff Debated by Street as Real or ‘Head Fake’

Dell Technologies Inc. surged as much as 12% touching a seven-month high on Wednesday following a report that the computer maker was mulling a spinoff of its stake in VMware Inc.

While Dell is also said to be considering buying the rest of the company or doing nothing, a spinoff of its 81% stake could finally eliminate a VMware “albatross” that has been causing the stock to trade at a discount, Wedbush analyst Daniel Ives wrote. But it’s unclear if this is “another head fake for investors.”