Symantec Corp. $12 – Nasdaq symbol SYMC

SYMANTEC CORP. $12 (Nasdaq symbol SYMC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 836.0 million; Market cap: $10.0 billion; WSSF Rating: Average) makes software that helps protect computers from viruses and electronic attacks. Its best-known product is the top-selling Norton Anti-Virus program. Symantec continues to make acquisitions that strengthen its current products. For example, it recently purchased UK-based MessageLabs, which offers online software that helps users protect their email and instant messaging services from spam and junk emails. To put the $695 million purchase price in context, Symantec earned $311.2 million in its second fiscal quarter ended October 3, 2008, up 18.5% from $262.6 million a year earlier. Per-share earnings grew 27.6%, to $0.37 from $0.29, on fewer shares outstanding. These figures exclude unusual items. Sales grew 7.0%, to $1.5 billion from $1.4 billion. Symantec continues to do a good job expanding sales to businesses, which cuts its reliance on the more volatile consumer market. It generally sells its products and services to corporate clients under long term contracts, which gives it steady revenue streams. The company’s corporate operations now supply 70% of its total revenue. Symantec spends about 14% of its revenue on research. That helps it maintain its lead in the rapidly changing field in which it operates. Symantec holds cash of $2.3 billion or $2.76 a share, so it has plenty of flexibility to expand research or make further acquisitions. The company should earn $1.27 a share in fiscal 2009, and the stock trades at 9.4 times that estimate. Symantec is a buy.

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