Symantec Searches for Spending Uptick

CUPERTINO, Calif. (TheStreet) -- Symantec(SYMC Quote) could be the latest tech heavyweight to enjoy the fruits of a rosier IT spending climate when it reports its second-quarter results Wednesday.

The software specialist, which posts its numbers after the market closes, was recently upgraded from Hold to Buy by Jefferies on the strength of improved security spending in the second half of the year.

Analysts surveyed by Thomson Reuters expect Symantec to report revenue of $1.43 billion and earnings of 33 cents a share, down from $1.52 billion and 37 cents a share in the period last year. With cybersecurity increasingly in the public eye, Symantec is nonetheless seen as offering upside potential.

Symantec, which recently ramped up its cybersecurity strategy, has certainly felt the effects of the recession. The firm, for example, missed analysts' first-quarter profit and sales estimates, as customers focused their attention on short-term contracts.

The software maker also missed Wall Street's fourth-quarter sales forecast, weighed down by foreign exchange pressures and a tight IT spending climate.

With the tech sector starting to rebound, however, at least one analyst thinks that Symantec is well positioned to boost its sales.

"They are likely to see a benefit in September quarter bookings and/or revenue," wrote Katherine Egbert, an analyst at Jefferies, in a note released this week. As the dominant provider of consumer security, Symantec should also reap the benefits of its August price increases, she added.

With up-and-coming ArcSight(ARST Quote) snapping at Symantec's heels, and rival McAfee(MFE Quote) enjoying good growth, the software maker faces stiff competition. McAfee, which is one of TheStreet's top picks for 2009, was recently upgraded by FBR Capital Markets, with the analyst firm citing a healthy cybersecurity spending climate.