Symantec (NASDAQ:SYMC), one of the major players in enterprise storage and security software besides EMC (NYSE:EMC), IBM (NYSE:IBM), NetApp (NASDAQ:NTAP) and HP (NYSE:HPQ), announced its earnings a couple of weeks ago, and since then its stock has dropped nearly 10% due to only a modest increase in revenues, which was below market expectations. Part of the drop can also be attributed to the drop in the broader market, which was fueled mainly by turbulence in the European region due to speculation of an Italian default.
Check out our complete analysis of Symantec.
Going forward, these are a couple of developments that we think will drive Symantec’s stock price.
Storage Software
This accounts for the biggest chunk of Symantec’s Trefis price estimate. Symantec recently announced upgrades to its storage products, adding new features and improving their performance. It also announced a new usage based pricing structure which should help it attract new customers.
It also upgraded its network attached storage appliance, adding support for de-duplication for primary data, more cluster nodes and virtual machine cloning and integration with other Symantec storage and security offerings.
We expect Symantec’s share of the global storage software market to increase marginally throughout the forecast period.
Security Software
Security software for business accounts for nearly 16% of Symantec’s Trefis price estimate, and saw a 27% increase in revenues last quarter.
Symantec is focused on this market; it recently announced a new cloud based hosted security and backup solution aimed at enterprises. Besides that, it also unveiled a new hosted mobile security solution – Accelerated NGNP – for telecom carriers, which will allow them to offer their subscribers enhanced security and protection.
Our $21 Trefis price estimate for Symantec stands more than 25% above its current market price.
Understand How a Company’s Products Impact its Stock Price at Trefis
