Significant resistance lies at 23.375 and good
support at 18.
You only have today and tomorrow to
worry about. I doubt you will be called out of the
25's. Even if SYMC does go above the resistance, you
will likely have a chance to buy back at 23.375 and
ride the wave up.
I don't really expect blow
away earnings. SYMC already said that they expect to
fall within analyst's expectations. But PC sales are
up and so maybe we will be surprised. Q4 is usually
a good quarter for SYMC but Q1 tends to be a better
as they have pretty good retail sales after people
get those new computers for Christmas.
does close below 18 especially on good volume, I'll
probably buy some puts as well.
I wouldn't lose
too much sleep over it. SYMC doesn't tend to be a
high flyer. I'm kind of guessing that the stock hasn't
been moving because investors are waiting for
earnings. They've missed the last 2 quarters.
stock is so predictable from a technical basis.
Deferred Revenue is Revenue which actually occurs
in this quarter, but is recognized in different
quarters for a variety of reasons. Companies such as MSFT
use deferred revenue to smooth out variations in
their business. Of course, it is illegal to do that,
but smart accountants can always find ways around
If you look at ERP companies such as PSFT, ORCL,
Baanf etc, they have significant deferred revenues.
Legally, it is supposed to represent revenue which should
be recognized later when the actual services are
delivered. So if PSFT agrees to deliver a product and its
upgrade a year later, the deferred revenue would
represent the upgrade which is due a year
That's my understaanding. I am sure accountants can do
much better that that. Good Luck.
1. DSOs declined from 43 days in the previous
quarter to 34. (By comparison, NETA's DSOs increased from
84 to 89 days).
2. Deferred Revenue went up
by 12 million in just the last quarter, from 34 to
46 million. That's 35% increase in D.R. in just one
3. Site Licenses went up 50% from Sept. quarter
4. Retail sales grew at 4% times the industry
average in terms of unit sales while they grew just 6% in
Revenue. However, this
is a studied strategy to lock
in customers as software sales will transition to a
subscribtion based service.
5. Whole slate of products
being sold into Corporate apart from NAV. These include
PC Anywhere, Norton Ghost, Norton 2000. 40% growth
in Norton Ghost from Sept quarter alone. Nearly 50%
of Fortune 500 companies using Norton Ghost. Ghost
for Netware in beta with 10,000 customers. Scheduled
for release in March. Norton 2000 showed 400%
increase in revenue from Sept quarter. But, of course, it
was released in Aug 98. BTW, Norton 2000 has 90% of
retail market according to latest PC Data
6. Converted significant number of NETA customers.
These include Haliburton (45,000 seats) United
Healthcare (30,000), Merril Lynch, Gateway, Whirlpool,
7. Symantec's web site gets 9
million hits a day. About 200,000 products download a
month in the Deecmber quarter.
8. IBM sales
force being trained to sell NAV and Norton 2000. There
will quotas for IBM's sales force for Symantec
products. Symantec was the first company to become an IBM
passport partner in October. Also, working with IBM Global
Services which is just beginning to show results.
Cross-selling of pructs such as Ghost and WinFax to Con-Edison
and WinFax to Pittsburgh National Bank.
AV engine based on Immune System technology due by
mid year. New release on Intel Landesk AV product due
in February. A 3rd version of Systemworks due next
(BTW Systemworks garnered 80% of the retail market in
the end of December).
10. Management appeared
to be more confident than it has been in several
quarters. Predicted 20% revenue growth for year 2000
(ending March 2000) and 25% earnings growth.
lots of other details which I'll post only if
Just got off a replay of the conference
Revenue $165 million, about 5-10 million ahead of
expectations. Deferred revenue was up $12 million from the
Sept. quarter. DSOs declined significantly to 34, so
the quarter was made easily.
expenses included $2.3 million in one-time transition
costs associated with the QDEK acquisition (expenses
not in charge), which if backed out would have
produced EPS of 44 cents.
Corporate: 39% of revs,
vs. 32% last q and 28% last year. IBM relationship
strong and Eubanks referred to exanding the relationship
in the next year.
F2000 guidance: 20% revenue
growth and 25% pretax margins by Q4:2000.
If they beat their numbers today, next quarter
will be another better quarter since the Quarterdeck
revenue and earnings will likely be added to Symantec's
numbers after the merge is finalized. The Quarterdeck
shareholders meeting where they will vote to finalize the cash
merger is planned for February.
Since layoffs at
Quarterdeck have occured where there is overlap, the
contribution to revenue should be much higher than the
contribution to expenses.
In addition, it should be
easier for Symantec to convert IBM and Intel customers
to Symantec's products since they have converted
some large customers already. These large conversions
will serve as references for other large companies
that are contemplating the change.
And once the
internet hype has cooled down a little, investors will be
looking for value companies to move their funds over to.
Symantec is truly a value play. Their current earnings
have one time charges included in them. If they beat
.40 today and do the same or better over the next
three quarters, they will have at least 1.60 for the
year. Their P/E should be at least 20. With a P/E of 20
they should have a price of 32.
Volume in the first 50 minutes is 700,000. The
stock is up 5.8%. More bullishly, from level II quotes,
it is clear that companies that follow the stock -
VOLP (Volpe Brown), DLJ,SNDS (Sands Brothers), Pacific
Crest Securities(mainly yesterday) are more on the bid
side. Of course, this can change in a heartbeat. But
enjoy it while it lasts. As I finsih typing the volume