(SYMC) Symantec to Acquire Nukona

Symantec Corporation (SYMC) upped its acquisition count with the recent takeover of privately-held Nukona Inc., a provider of mobile application management (MAM) services. The financial terms of the acquisition were not disclosed.

This is an important acquisition for the information technology (IT) security major, as it will likely enhance Symantec’s enterprise mobility portfolio. With Nukona’s capabilities, Symantec will be able to deliver mobile application security solutions that can run on different platforms..

With this enhancement in its enterprise mobility portfolio, Symantec will aid IT organizations in protecting and isolating corporate data and applications across corporate and personal devices. Symantec expects to close this transaction in April and is subject to customary closing conditions.

Earlier this month, Symantec had acquired Odyssey Software, a leading provider of mobile device management (MDM). The acquisitions have allowed Symantec to help customers better manage and enforce IT policies, identify and protect against threats, as well as repair and service assets. We believe acquisitions will help the company to increase its scale of operations, acquire more customers and enhance its technological expertise.

Apart from acquisitions, the company has also adopted other means for growth. This includes wooing other customers by offering new services. This strategy helped the company in winning new orders for its Internet mobile security solutions. This fact is further emphasized by Samsung Electronics’s selection of Symantec’s flagship product, Norton Mobile Security, for a 90-day complimentary subscription on its Galaxy smartphones.

The Internet security market is growing steadily and offers incremental growth opportunities. We expect the network security market to return to the pre-recession growth levels going forward. The global network security market, described as hardware and software with functionality, which includes segments such as firewalls, VPNs, intrusion prevention and detection, and multi-purpose security known as unified threat management, are expected to generate higher revenues in the coming years and the company is well positioned to capitalize on this opportunity.

Symantec delivered modest third quarter 2012 results with both the top and bottom line surpassing the Zacks Consensus Estimates. Geographical and segmental performances were good, barring the EMEA and Service segment.

The company had considerable cash in the quarter with its continuous share buyback program. Fourth quarter guidance was sequentially weak, which could be due to soft performance of its Consumer segment (due to lackluster PC sales) and stiff competition from McAfee (which has been acquired by Intel Corp. (INTC).

Good news on Symantec’s part was that research firm Gartner expects the worldwide spending on security software to rise 10% this year to $20.7 billion.

The company has a Zacks #3 Rank, implying a short term Hold rating.

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