Two analysts have raised their EPS estimates for this company in the last 30 days; growth forecasts are for 31% in 2017.
Symantec Corp. (SYMC)
From Stock Pickers Digest
Symantec Corp. (SYMC) continues to strengthen its fast-growing cybersecurity business. The company will buy privately held Blue Coat for $4.65 billion. That business makes products to protect clients from cyberattacks through their websites and networks. Blue Coat has also emerged as a leader in security for cloud computing, and serves over 15,000 businesses.
The combined company will get 62% of its sales from corporations, up from Symantec’s 50%. That’s more profitable and stable than selling anti-virus software to individual consumers. Adding Blue Coat will also give Symantec a big marketing and research edge over competitors Palo Alto Networks, FireEye and Check Point Software.
As well, Blue Coat’s CEO Greg Clark will take over at Symantec. Michael Brown stepped down from the CEO position in April after the company posted lower-than-expected fourth quarter results. In those three months ended April 2, 2016, the company’s earnings fell 27.6%, to $147 million, or $0.22 a share, from $203 million, or $0.29. That was below the consensus forecast of $0.24 a share.
Sales declined 2.9%, to $873.0 million from $899.0 million. The revenue slide came as the company shifted clients over to its cloud-based service. That hurts near-term sales, but should make it easier for customers to renew their subscriptions. Higher costs also contributed to Symantec’s earnings decline. To address that, it’s now cutting 1,200 workers, or 10% of the total, and closing some facilities. Those moves should save over $400 million a year.
Symantec is a top pick for 2016.
Patrick McKeough, Stock Pickers Digest, www.tsinetwork.ca, 888-292- 0296, July 2016