McAfee Gets Set for Third-Quarter Boost
SANTA CLARA, Calif. (
) --
McAfee
(MFE)
is expected to continue its upward trajectory when it reports its third-quarter results after market close Thursday, boosted by growing demand for the company's
products.
The software specialist, which was one of
TheStreet
's
top tech picks
for 2009, has gone from
strength to strength
this year.
Analysts surveyed by Thomson Reuters expect McAfee to report revenue of $486.6 million and earnings of 61 cents a share, up from $410 million and 31 cents a share in the same period last year.
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McAfee itself has predicted third-quarter revenue between $475 million and $495 million. Excluding charges, the Silicon Valley firm expects to clinch earnings between 58 cents a share and 62 cents a share.
Jefferies analyst Katherine Egbert expects McAfee's consumer business to grow 8.5% compared to the same period last year, reaching $177 million, and predicts 12.5% growth during the fourth quarter. Like rival
Symantec
(SYMC) - Get Symantec Corporation Report
, McAfee will reap the benefits of a
, according to Egbert.
"Lately, however, upside to consumer end point security sales is more likely to come from upsales of product suites, rather than new unit growth," she added, in a note released this week.
McAfee was recently
upgraded
by FBR Capital Markets on the strength of healthy cybersecurity spending and its strong product portfolio.
The software maker's results come hot on the heels of rival Symantec's strong
, underlining the growing importance of cybersecurity.
Although Symantec has traditionally dominated the security software space, McAfee has been enjoying impressive growth, prompting speculation that it could eventually
its rival.
"We believe it is likely that the trend of McAfee outgrowing Symantec is likely to continue," wrote Todd Weller, an analyst at Stifel Nicolaus, in a note released Thursday. "It is likely that Symantec continues to lose share in the consumer business to McAfee and we will get a better sense of this when McAfee reports after the close."
Firmly established as a Wall Street
, McAfee's stock also has risen more than 50% since March.
McAfee blew past analysts' estimates in its
, boosted by sales to both corporations and consumers. The latest economic indicators also bode well for the firm's third quarter.
The American economy grew 3.5% year over year during the third quarter, according to figures released this week by the U.S. Department of Commerce, signaling that the country is finally emerging from recession. Boosted by government and consumer spending, the 3.5% growth rate is the strongest expansion in more than a year.
Federal dollars could prove key to maintaining McAfee's momentum. Just as attacks on U.S. businesses by cyber-criminals are rife, so government bodies are also looking to
national infrastructure from the growing phenomenon of cyber-warfare.
Earlier this year, a host of high-profile Web organizations in the U.S. and South Korea, for example, were
in an audacious
cyber attack
. The denial-of-service attack attempted to bring down the likes of the
New York Stock Exchange
, Treasury and White House Web sites by bombarding them with requests from more than 100,000 infected computers dotted around the globe.
The security market is changing dramatically, however, as evidenced by
Microsoft's
(MSFT) - Get Microsoft Corporation Report
decision to offer
free
anti-virus PC software. Another security company attracting
is
ArcSight
(ARST)
, which sells devices for monitoring security threats across networks and data centers.
-- Reported by James Rogers in New York
