(Reuters) - Symantec Corp shares could gain 25 percent or more following steps to cut costs and a recent acquisition that could propel the company’s business in the hot cybersecurity market, a Barron’s report said on Sunday.
Barron’s said Symantec, an early pioneer in antivirus software with its Norton brand, boosted its prospects of gaining a larger share of the cybersecurity market with its June agreement to buy Blue Coat Systems Inc [PRJCBB.UL].
The company will be able to sell Blue Coat’s web and cloud protection services to its existing base of more than 370,000 business clients as demand to block hacking attempts grows, the newspaper said.
Plus, the newest Norton software is “industry-leading,” the newspaper said, citing Andrew Nowinski, an analyst for investment bank Piper Jaffray. Nowinski predicts the company’s earnings will grow 12 to 14 percent from fiscal 2019 to 2021 as Symantec’s consumer business benefits from a shift to a subscription model.
More than $92 billion will be spent on tech security this year, up from $84 billion in 2015, according to data Barron’s attributed to research firm Gartner Inc.
Plans to trim its workforce by 10 percent and cut $550 million in costs by the end of Symantec’s 2018 fiscal year will also help boost the company’s earnings under new CEO Greg Clark, according to the report.
Symantec shares have already risen 40 percent this year, closing at $23.72 on Friday, but the article quotes Franklin Templeton portfolio manager Christian Correa as saying he sees “no reason the stock can’t be in the low $30s” within 12 to 18 months.
Reporting by Trevor Hunnicutt; Editing by Andrea Ricci