) has recently grabbed the headlines with some positive
developments. It is evident from the recent divesture of
AdvisorSquare that Symantec is focusing on its core competencies.
AdvisorSquare, which develops websites for financial services
firms, has been taken over by Smarsh Inc., having a similar line of
Although the terms of the deal were not disclosed, AdvisorSquare
will enhance the range of products Smarsh offers to financial
services companies. Hence, we believe this is win-win situation for
both Symantec and Smarsh Inc.
AdvisorSquare is a strategic fit with Smarsh's business model,
as the latter offers compliance, e-mail and Web archiving, and
website development services to the financial services industry.
With this particular acquisition of AdvisorSquare and along with
the Financial Visions Web design platform, Smarsh now has nearly
7,000 financial services websites in its domain.
Symantec is not only pursuing an acquisition/divesture strategy
to grow its core business, but also conducting surveys to explore
new business opportunities.
A recent survey by the company revealed that online file sharing
is becoming popular among small and medium sized businesses (SMBs)
as it reduces bottlenecks. However, this exposes the SMBs to
greater Internet security risk.
Moreover, as SMB employees are increasingly adopting unmanaged,
personal-use online file sharing solutions on their mobile devices,
the line between work and play continues to fade, further raising
This is another area where the company looks to focus in the
days to come as this still remains untapped. At the recent CEO
meeting, the management exuded confidence on the company's outlook.
The company expects around 8% growth in total bookings, but we
believe that there is significant competition in the SMB segment
and Symantec must come out with new products and services if it is
to grow in this environment.
Although the Internet security market is growing steadily and
offers incremental growth opportunities, smaller companies like
Kaspersky and Quick Heal that have resorted to aggressive pricing
to sell their innovations poses a considerable challenge to the
Symantec offers a broad range of security and storage products
to its end customers and also entered the mobile, cloud computing,
and virtual environments business. Having said that, we must also
add that large portions of the company's core business face
significant growth challenges, including slowing PC growth, and
making considerable effort to improve its SMB business.
This apart, the company competes in a market, which is mature
and competitive. Moreover, stiff competition from McAfee (acquired
) as well as the prevailing economic turmoil in Europe may weigh on
the company's business prospects this year.
The company has a Zacks #3 Rank, implying a short-term Hold
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