Monday, June 18, 2007

Symantec (NASDAQ_SYMC): Added to the Buy list at GSCO

- Goldman Sachs is adding Symantec (NASDAQ:SYMC) to their Americas Buy List and lifting their price target to $25 from $21 previously, representing 27% upside from latest close. The firm is also increasing their estimates for both the June quarter and FY08 to above consensus.

GSCO notes their more positive view on the stock is driven by: 1) Impressive upcoming releases of its flagship products; 2) Their view that internally the company is healthier than it has been since the Veritas acquisition closed over two years ago; 3) Anticipation of upside to conservative guidance in June and FY08; 4) Aggressive buybacks, 5) Wanting to be early on a turnaround story given investor appetite for this.

Major product releases over the next few months - NetBackup 6.5, this summer and Endpoint Protection 11.0, anticipated in September - should stem shares losses and provide a boost to revenues. For the June qtr, the firm expects upside to Street estimates and have raised their EPS estimates to $0.22, from $0.20 (Street at $0.20, guidance $0.18-$0.20).

Notablecalls: Well, GSCO touted SYMC as one of their top picks just before the co warned in January. They removed SYMC from their Buy list following the warning and now that the stock has bounced 20% from the bottom and is trading about 1 buck from the pre-warning level, it's being added to the list again. Absurd enough to work? Yeah, why not! Count me in!

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