Morgan Stanley on VMware: they may struggle to hit consensus

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Just like most IT companies, the VMware stock performance is not exactly outstanding.
A little more than one year ago VMW reached $124.83 per share, and now it is near its minimum at $22.32.
But things can go worse.

Before Christmas Techworld reported an interesting note appeared in the last Morgan Stanley research about VMware:

First, Q4 is off to a slow start and we believe VMW may struggle to hit consensus. Second, ELA (VMware’s Enterprise Licence Agreement) momentum is slowing, which likely removes a major driver of license growth. Third, headcount will weigh on margins in the first half of 09.

This comment led to a “Sell” recommendation on VMW shares.

Morgan Stanley is not alone: even UBS cut its rating from “Neutral” to “Sell” last month as reported by ServerWatch.
But the fact that UBS is the largest VMware stockholder after EMC raises some additional concerns.