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$14.04 -0.75 (-5.07%)
10/15/2008 4:00 PM

Symantec Corp (SYMC)

CAPS Rating:
**

The Company deals in infrastructure software, enabling businesses and consumers to have confidence in a connected world.

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Avatar NetscribeSoftwre (97.29) Submitted: 1/18/07 8:58 AM : Outperform Start Price: $17.98 SYMC Score: 15.21

Symantec Corporation founded in 1982, is in the business of providing software and solutions for security and storage of IT based infrastructure. The company operates in five segments i.e. Consumer Products, Security and Data Management, Data Center Management, Services and Other. The Data Center Management segment that provides server management and application performance management solutions to enterprises contributes over around half of the total revenues. While Security and Data Management segment provides information security and security management software that also form an important part of the inflows.

The antivirus software market is dominated by top three vendors accounting for over 80% of the total sales. Symantec holds a very strong position with over 50% market share in the consumer antivirus market under its Norton brand name. The industry is expected to see growing performance with the revenue generation set to almost double by the year 2012 from the current $4 billion. The entry of the much talked about Windows OneCare has still not been able to create a mark. Though in the coming years, launch of new Windows operating system Vista, that claims to provide higher security and protection, might create a risk for the existing companies.

Symantec’s stocks is currently witnessing a huge drop of about 17%, due to weaker performance of its Data Center Management segment, and lower than estimated outlook for the third quarter. However, this temporary slump might not affect the long term outlook of the company which is looking strong. Symantec is ready with the launch of new versions and upgrades of its huge product portfolio and the newest version focusing on data storage that merges the technology of the acquired Veritas.

Further, Symantec has a strong cash flow that can be used to buy future growth. Adding to it, the company being the market leader is set to benefit from the growing industry, and so this significant drop might prove a good opportunity to get into the business with strong fundamentals and healthy outlook.

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Avatar NetscribeSoftwre (97.29) Submitted: 5/07/07 6:58 AM

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Symantec notched yet another strong performance., with revenues for the year 2007 increasing 25% to $5.2 billion, as a result of higher income generated from consumer product segment due to rise in inflows from the core Norton Internet Security product line. The bottom line also surged to $404.4 million, up from $156.9 million, primarily led by improved margins, other income and lower restructuring charges. Though it’s Security and Data Management business still is the major worry, the 2% segmental growth witnessed during the quarter, was one of the key positives and can continue to show signs of further improvement in the coming fiscal.

Company’s acquisition spree continued, with the recent completion of $830 million acquisition of Altaris, a systems management specialist for managing PCs, servers, handheld devices. The acquisition augers well for Symantec’s network access control (NAC) technology that will aid the company in providing the desired infected devices from penetrating network defenses. This latest acquisition can be cited as an important move to generate a substantial inorganic growth for the company, after the $10.25 billion Veritas merger witnessed in July 2005.

Symantec’s new product cycle is also underway with launch of Norton 360 in various international markets, while the company is ready to launch NetBackup PureDisk Remote Office Edition 6.0, the remote data backup software in June. With rapid data growth witnessed in various multinational corporations, such remote data backup software might prove a very strong revenue earner in the coming years. Further, considering company’s strong fundamentals, recurring revenue stream and its latest venture into software as a service platform for small- and mid-size businesses makes Symantec a strong investment for 2007.

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