Symantec Outperforming the Big Guys

NEW YORK ( TheStreet) -- Symantec ( SYMC) has been a Wall Street and Nasdaq 100 darling this past year. During the past quarter the stock was up in 29 sessions for a price increase of 28.28%.

The company provides Internet security technology and a broad range of content security solutions to individuals and companies. It also provides anti-virus protection, Internet content, email filtering, and mobile code detection technologies to enterprise customers.

During the last six months the stock has not only increased in price but has also beat the market by 3:1. In the last half year the stock was up 36% while the market as measured by the Value Line Index was up only 12%. A graph provided by Barchart illustrates how much the stock has beaten the market:

Let's look at the factors on play:

Fundamental factors: The stock has a market cap of $16.88 billion with a P/E of 15.79. During the next year the company plans to increase margins from 25% up to 30% and increase the revenue by 5%. The board has approved a stock buy back plan and will begin paying a dividend in the 2.5% range.

Analysts projected revenue to increase by 2.3% this year and another 1.7% next year. Earnings are estimated to increase by 6.2% this year, an additional 12.3% next year and continue to rise about 8.31% annually for the next five years. The company has a B++ financial strength ranking and TheStreet rates this an A- stock.

Technical indicators provided by Barchart: The stock has a 100% Barchart technical buy signal coupled with a Trend Spotter signal triggered on Jan. 3. Since then the stock has gone up 25%. The stock is trading above its 20-, 50- and 100-day moving averages and in the last quarter hit 29 advances in price and is up 28.28%.

The stock has a Relative Strength Index of 76.49% and Barchart computes a technical support level of 23.83. Recently traded at 23.31 which is above its 50-day moving average of 21.26.

Investor interest: 27 Wall Street analysts have run numbers on the company and issued 13 strong buy, two buy and 12 hold recommendations on the stock. On Motley Fool the individual investor has given the stock an 85% chance of beating the market, with 627 readers expressing an opinion. Short sellers have a different view and since 1/15 have built their short positions from 6.6 million shares up to 11.4 million shares on 2/15.

Peer comparisons: The market always has the final vote and in the past year Symantec was up 42%, Microsoft ( MSFT) down 10%, Oracle ( ORCL) up 19% and SAP ( SAP) up 23%.

Microsoft: Analysts issued 13 strong buy, 10 buy and 14 hold reports. They project earnings to compound annually at 8.38%. The Financial Strength is A++ and TheStreet rating is B.

Oracle: Analysts released nine strong buy, 22 buy and 13 hold recommendations. They predict earnings will be up 11.97% annually for the next five years. The Financial Strength is A++ and TheStreet ranks the stock an A.

SAP: Analysts wrote five strong buy, two buy, 10 hold, two underperform and a sell call. They estimate earnings will increase annually at a 12.30% range over the next five years

My recommendation: The price on Symantec has risen fast but technical indicators reveal the stock still has momentum. Never underestimate the knowledge of the short sellers.

If the price keeps rising they will have to cover their short positions and the stock will get another bump. Monitor the moving averages and 14-day turtle channels so you won't get caught if they just happen to be right.

At the time of publication the author had no position in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.