Symantec's (SYMC) New Strategy a Winner, Thinks MKM

Yesterday Symantec Corp. (NASDAQ: SYMC) announced a new strategy that will streamline and simplify the company. Among other initiatives, the strategy includes a reduction in the workforce targeting middle management, and the company expects non-GAAP operating margins to increase by approximately 200 basis points in FY14, although initial estimates for severance payments of approximately $275 million will impact cash flows.

Commenting on the development, MKM analyst Israel Hernandez said "We view management's strategy for driving 30%+ operating margins, up from the mid-20% range today, and 5% organic growth as credible. The move to consolidate operations from business unit alignment to functional alignment should drive meaningful sales, marketing and operational leverage, in our view. We believe management’s 30% target has room for upside, given the plan to reduce sales & marketing spend by nearly 13% points over the next four years."

Hernandez said he would be an aggressive buyer following the announcement and raised his price target on Symantec to $27 from $25. MKM has a Buy rating on the stock.

For an analyst ratings summary and ratings history on Symantec (NASDAQ: SYMC) click here. For more ratings news on Symantec click here.

Shares of Symantec closed at $21.46 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Morgan Stanley Upgrades Telecom Argentina (TEO) to Overweight
• Lucid Capital Markets Starts Palmer Square Capital BDC (PSBD) at Neutral
• Barrington Research Starts CBIZ, Inc. (CBZ) at Outperform