The Situation

While EMC is outdoing many of its peers financially, part of that success is directly related to its stake in VMware.

Joseph Wittine, a senior equity analyst at Longbow Research, told CRN that investor pressure for EMC to merge or be acquired stems in part from the math related to EMC's valuation in the event that it would sell its VMware business.

EMC has a market capitalization of about $61 billion, while VMware has a market capitalization of about $40 billion. Subtracting VMware's share of EMC's market capitalization and earnings gives the core EMC business a valuation of about $29 billion, which is only under 10x earnings, which Wittine said was low compared to rivals such as NetApp.