CUPERTINO, Calif. (
could be the latest tech
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
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
, Symantec is nonetheless seen as offering upside potential.
Symantec, which recently
its cybersecurity strategy, has certainly felt the effects of the recession. The firm, for example,
profit and sales estimates, as customers focused their attention on short-term contracts.
The software maker also missed Wall Street's
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.
snapping at Symantec's heels, and rival
, the software maker faces
. McAfee, which is one of
for 2009, was recently
by FBR Capital Markets, with the analyst firm citing a healthy cybersecurity spending climate.
And with new CEO Enrique Salem at the helm, however, Symantec is keen to tap emerging technologies such as Software-as-a-Service (SaaS). During the company's analyst day earlier this year, Salem predicted that
will account for 15% of its total revenue in the next five years.
The CEO, who took the company's reins from
, explained that Symantec is also looking to cross-sell between its archiving and backup software, as well as targeting small-to-medium sized businesses.
More recently, Symantec revealed plans to bring its e-commerce business back
, signaling the end of its e-commerce partnership with outsourcing specialist
"While Symantec may experience some near-term headaches as it transitions this business in-house, as theexisting contract expires on June 30, 2010, we believe this is a long-term positive for the company as it could lead to higher margin business and incremental revenue opportunities," wrote Daniel Ives, an analyst at FBR Capital Markets, in a recent note.
Symantec shares dipped 10 cents, or 0.62%, to $16.06 Wednesday, as the Nasdaq fell 1.74%.
-- Reported by James Rogers in New York