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Valued at a market cap of $17 billion, Gen Digital Inc. (GEN) is a global cybersecurity company specializing in consumer security, identity protection, and digital privacy solutions. Formed through the merger of NortonLifeLock and Avast, the Arizona-situated company offers a comprehensive suite of security products, including antivirus, VPN services, and identity theft protection.
Companies worth more than $10 billion are generally described as “large-cap” stocks and Gen Digital fits this criterion perfectly. The company serves millions of users worldwide, leveraging artificial intelligence and cloud-based security technologies to combat evolving cyber threats. With a strong recurring revenue model, strategic partnerships, and continued innovation, Gen Digital aims to strengthen its position in the cybersecurity industry.
However, shares of GEN are trading 12.6% below its 52-week high of $31.72, which they reached on December 4. The shares have fallen 1.2% over the past three months, compared to the Technology Select Sector SPDR Fund’s (XLK) 11.3% fall over the same time frame.
Moreover, GEN stock is up 1.3% over the past six months, outperforming XLK’s 6.1% decline. Shares of GEN have rallied 25.7% over the past 52 weeks, outpacing XLK’s 2.8% return.
To confirm its recent bullish trend, GEN has been trading above its 50-day and 200-day moving averages for a couple of trading sessions.
GEN delivered solid third-quarter results on Jan. 30, but its shares tumbled 3.5% in the next trading session. The company posted a 4% year-over-year revenue increase to $986 million, narrowly surpassing analyst estimates, while adjusted EPS climbed 14.3% to $0.56. Direct customer revenues contributed $869 million, up from $834 million, and the direct customer base expanded to 40.1 million, with an average revenue per user (ARPU) of $7.27. The retention rate also improved to 78%, indicating strong customer loyalty.
Nevertheless, GEN has lagged behind its rival, Check Point Software Technologies Ltd. (CHKP), with a 16.9% gain over the past six months and a 38.8% return over the past 52 weeks.
Analysts remain cautiously optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the seven analysts covering the stock, and the mean price target of $33.57 suggests a premium of 21.9% to its current market levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
