symantec

WESTJET AIRLINES $13.95 (Toronto symbol WJA; TSINetwork Rating: Extra Risk) (1-877-493-7853; www.westjet.com; Shares outstanding: 130.8 million; Market cap: $1.8 billion; Dividend yield: 1.7%) reports that its revenue rose 12.9% in the three months ended December 31, 2011, to $781.5 million from $692.2 million a year earlier. Demand for the company’s flights remains high, and it has entered into new partnerships with other airlines; these were the main reasons for the higher revenue. Earnings fell 4.3%, to $35.6 million from $37.2 million. Higher fuel prices were the main reason for the decline. However, earnings per share were unchanged at $0.26, due to fewer shares outstanding. The company has also raised its quarterly dividend by 20%, to $0.06 from $0.05. The shares now yield 1.7%....

SYMANTEC CORP. $17.94 (Nasdaq symbol SYMC; TSINetwork Rating: Average) (1-408-517-8000; www.symantec.com; Shares outstanding: 737.2 million; Market cap: $13.2 billion; No dividends paid) reports that its earnings per share gained 20.0% in the three months ended December 30, 2011, to $0.42 from $0.35. Sales rose 6.9%, to $1.72 billion from $1.6 billion.

Demand for security software will likely remain steady due to rising concerns about identity theft and online intruders. However, a shortage of hard drives due to flooding in Thailand is dampening computer sales. That would hurt Symantec, because the company gets 85% of its sales to consumers from software that is preinstalled on new computers. Consumers account for about 30% of Symantec’s overall sales.

As well, economic uncertainty will probably weigh on sales in Europe, which supplies around 25% of Symantec’s overall sales.

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INTERNATIONAL BUSINESS MACHINES CORP., $190.46, New York symbol IBM, is our “Stock of the Year” for 2012. The company continues to benefit from its decision in the 1990s to focus on selling its expertise instead of computer hardware. IBM now gets most of its revenue from steady and predictable long-term contracts. That cuts its risk. The company is now using its strong profits to expand into promising new areas, such as online data storage and software that helps businesses analyze customer spending patterns. As well, IBM’s strong reputation is helping in expand in Asia and Latin America. That cuts its reliance on slower-growing regions like North America and Europe....

TEMPUR-PEDIC, $70.09, symbol TPX on New York, reported higher revenue and earnings in the latest quarter. The company makes and distributes therapeutic mattresses and pillows made from its Tempur material. In the three months ended December 31, 2011, Tempur-Pedic’s earnings rose 21.7%, to $56.3 million from $46.3 million a year earlier. The company bought back $365.9 million of its shares in 2011. Due to fewer shares outstanding, earnings per share rose 26.5%, to $0.86 from $0.68. The company spent more on marketing in the latest quarter, but it has done a good job of cutting its costs and streamlining production....

SYMANTEC CORP. $16.55 (Nasdaq symbol SYMC; TSINetwork Rating: Average) (1-408-517-8000; www.symantec.com; Shares outstanding: 751.0 million; Market cap: $12.4 billion; No dividends paid) makes computer-security software, including the popular Norton antivirus program. It also sells products and services for email filtering, data backup and other business-related uses. In addition, Symantec offers data-archiving software that helps its clients meet increasingly strict regulatory and compliance standards. In the three months ended September 30, 2011, Symantec’s earnings rose 33.8%, to $182 million from $136 million a year earlier. Earnings per share jumped 41.2%, to $0.24 from $0.17, on fewer shares outstanding. If you exclude unusual items, mainly asset writedowns and restructuring costs, earnings per share would have risen 14.7%, to $0.39 from $0.34. That matched the consensus earnings estimate. Sales rose 13.6%, to $1.7 billion from $1.5 billion. The company gets 52% of its sales from overseas. If you disregard the positive impact of exchange rates, sales would have risen 9% in the latest quarter....

SYMANTEC CORP. $16.55 (Nasdaq symbol SYMC; TSINetwork Rating: Average) (1-408-517-8000; www.symantec.com; Shares outstanding: 751.0 million; Market cap: $12.4 billion; No dividends paid) makes computer-security software, including the popular Norton antivirus program. It also sells products and services for email filtering, data backup and other business-related uses. In addition, Symantec offers data-archiving software that helps its clients meet increasingly strict regulatory and compliance standards.

In the three months ended September 30, 2011, Symantec’s earnings rose 33.8%, to $182 million from $136 million a year earlier. Earnings per share jumped 41.2%, to $0.24 from $0.17, on fewer shares outstanding. If you exclude unusual items, mainly asset writedowns and restructuring costs, earnings per share would have risen 14.7%, to $0.39 from $0.34. That matched the consensus earnings estimate.

Sales rose 13.6%, to $1.7 billion from $1.5 billion. The company gets 52% of its sales from overseas. If you disregard the positive impact of exchange rates, sales would have risen 9% in the latest quarter.

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CAMECO CORP. $17.79 (Toronto symbol CCO; TSINetwork Rating: Extra Risk) (306-956-6200; www.cameco.com; Shares outstanding: 390.0 million; Market cap: $6.9 billion; Dividend yield 2.3%) has dropped its hostile takeover bid for Hathor Exploration (symbol HAT on Toronto). However, Cameco could still profit from Hathor’s uranium properties (see below). Hathor’s main exploration properties, including its Midwest Northeast property, are on the east side of the Athabasca Basin. This region contains all of Canada’s producing uranium mines and accounts for 23% of global production. Cameco holds cash of $1.2 billion, or $3.30 a share, so it can afford to make acquisitions that enhance its growth prospects. However, it dropped its Hathor bid because it felt the price had risen too high....

SYMANTEC $15.39 (Nasdaq symbol SYMC; TSINetwork Rating: Average) (1-408-517-8000; www.symantec.com; Shares outstanding: 751.0 million; Market cap: $11.6 billion; No dividends paid) has agreed to sell its 49% stake in Huawei Symantec Technologies for $350 million. This joint venture sells computer security and data-storage products to businesses, mainly in China. The buyer is Symantec’s partner, Hong Kong-based Huawei Technologies Co.

The joint venture has lost money since it was formed in 2008, so selling it will make Symantec more profitable.

Symantec is a buy.

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INTERNATIONAL BUSINESS MACHINES CORP., $185.24, New York symbol IBM, rose initially in response to news that Warren Buffett’s Berkshire Hathaway Inc. (New York symbol BRK.A) now owns 5.4% of IBM. However, the stock fell 1% for the week. This is Mr. Buffett’s first major investment in a technology company. IBM’s revenue and earnings growth has slowed recently, due to the weaker global economy, but its long-term outlook remains strong. The company continues to benefit from strong growth in emerging markets, like Russia and Brazil. Strong business growth in these countries is spurring demand for reliable computer services. By 2015, IBM feels these markets will supply 30% of its revenue, up from 23% now....

INTACT FINANCIAL CORP., $56.68, symbol IFC on Toronto, is Canada’s largest provider of property and casualty insurance, based on premiums. Its brands include Intact Insurance, Canada BrokerLink, belairdirect and Grey Power. The company recently completed its purchase of AXA Canada from Paris-based ASX Group for $2.6 billion. To put that in context, Intact’s market cap is $6.3 billion. Intact plans to look for more casualty and property insurers to buy in Canada. That includes other subsidiaries of European insurers, many of which are struggling. Intact estimates that as much as 30% of the Canadian property and casualty market is controlled by foreign-owned insurers....