Waiting for a European recovery

Article Excerpt

These two leading software makers have each gained about 20% since the start of 2012. However, the slowing European economy could limit their progress. SYMANTEC CORP. $18 (Nasdaq symbol SYMC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 729.4 million; Market cap: $13.1 billion; Price-to-sales ratio: 2.0; No dividends paid; TSINetwork Rating: Average; www.symantec.com) sells anti-virus and email filtering software to businesses and consumers. In its fiscal 2012 third quarter, which ended December 30, 2011, Symantec’s earnings rose 15.4%, to $314 million from $272 million a year earlier. Earnings per share gained 20.0%, to $0.42 from $0.35, on fewer shares outstanding. These figures exclude asset writedowns and costs to integrate acquisitions. Sales rose 6.9%, to $1.7 billion from $1.6 billion. Symantec gets 52% of its sales from overseas. If you disregard the positive impact of exchange rates, sales would have risen 6% in the quarter. Demand for security software will likely keep rising due to rising concerns about online intruders. However, a shortage…