The cyber-security industry pioneer has been under immense pressure, since its anti-virus software always came bundled with PCs, and PC sales have fallen to the lowest since 2008. It has been trying to regain momentum, and focus on anti-hacking technologies. It faces intense competition from startups that are capturing bigger chunks of the cyber-security market, which has recently boosted due to advanced attacks from nations, such as Russia, Iran, and China.
To help the company stabilize, Silver Lake
Partners announced to invest $500 million, which will also allow the
latter to acquire a seat on the former’s Board. Moreover, activist hedge
fund Elliott Management Corporation has also bought a large stake in
the company, which makes it the largest stakeholder; it supports Silver
Lake’s investment as well.
FBR Capital Markets analyst Daniel Ives commented that the new
investment will help boost investors’ confidence about the company’s
future acquisition plans. He said that the investors will be satisfied
to have Silver Lake’s Ken Hao on the Board.
Symantec also announced a $2.3-billion share
repurchase program till March 2017, and stated that it will pay a
special dividend of $4 per share, which totals to $2.7 billion. It added
that after the capital return, the company will have almost $5 billion
in cash, with which it can opt for further acquisition deals.
For the following quarter, the company foresees EPS to be in the $0.24-0.27 range, against the Street’s estimates of $0.25. Revenue is forecasted to be $885-915 million, as opposed to the $901.73-million projection. At present, Symantec stock is trading up 11.78% at $21.44, as of 7:53 AM EST.
By: Martin Blanc.
Review:
Emerging Market Formulations & Research Unit, Flagship Records.
For
The #FacebookTeam