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NortonLifeLock (NLOK) Avast Buyout Gets UK Regulator's Approval
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NortonLifeLock is finally set to complete its much ambitious acquisition of the London-listed rival cyber security firm, Avast Plc, as Britain’s competition regulator gave its final nod for the merger. The American consumer cyber safety provider now expects to close the deal on Sep 12.
NortonLifeLock already received regulatory approval from the U.S. Federal Trade Commission in November last year. The waiting period for a review of the transaction under the Hart-Scott-Rodino Act expired on Nov 12, 2021.
Why Does Avast Buyout Make Sense for NortonLifeLock?
U.S.-based NortonLifeLock and U.K.-based Avast Plc reached a merger agreement on Aug 10, under which the former agreed to acquire the latter in a cash-and-stock deal worth $8.6 billion.
The merger will combine two broad and complementary product portfolios, thereby helping NortonLifeLock become a global leader in the consumer security software market. Avast makes free and premium security software for desktops and mobile devices, while NLOK primarily deals with consumer cyber safety.
The acquisition of Avast will help NortonLifeLock enhance its product portfolio and customer base. The U.S.-cybersecurity firm believes that this combination will untie their complementary product portfolio strength for more than 500 million users.
The merger will strengthen geographical diversification and will likely help NortonLifeLock expand its presence in the Small Offices/Home Offices cyber security and very small businesses markets.
NLOK believes that the combination will be accretive to its top and bottom-line growth. It projects that the acquisition will drive double-digit growth in earnings per share within the first full year following the completion of the transaction and double-digit growth in revenues over the long run.
The acquisition is also anticipated to strengthen the financial profile of the combined entity through cost synergies, increased scale, long-term growth and strong cash flow generation. NortonLifeLock estimates that the merger will create approximately $280 million of annual cost synergies.
Last month, NortonLifeLock reported solid results for the first quarter of fiscal 2023 despite ongoing macroeconomic headwinds, including inflationary pressure, supply-chain issues and the Russia-Ukraine war. The company’s first-quarter non-GAAP revenues increased 2% to $707 million, while non-GAAP earnings soared 7% to 45 cents per share.
Zacks Rank & Other Stocks to Consider
Currently, NortonLifeLock carries a Zacks Rank #2 (Buy). Shares of NLOK have decreased 12.1% year to date (“YTD”).
The Zacks Consensus Estimate for Clearfield's fourth-quarter fiscal 2022 earnings has been revised upward by 10 cents to 80 cents per share over the past 60 days. For fiscal 2022, earnings estimates have moved 36 cents north to $3.13 per share in the past 60 days.
Clearfield’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 33.9%. Shares of CLFD have soared 18.2% YTD.
The Zacks Consensus Estimate for Silicon Laboratories’ third-quarter 2022 earnings has increased 36.1% to $1.13 per share over the past 60 days. For 2022, earnings estimates have moved 20.5% up to $4.41 per share in the past 60 days.
Silicon Laboratories’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 63.6%. Shares of SLAB have decreased 43.1% YTD.
The Zacks Consensus Estimate for Taiwan Semiconductor's third-quarter 2022 earnings has been revised a penny southward to $1.69 per share over the past 30 days. For 2022, earnings estimates have moved 37 cents north to $6.30 per share in the past 60 days.
TSM's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.9%. Shares of the company have decreased 32.7% YTD.
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NortonLifeLock (NLOK) Avast Buyout Gets UK Regulator's Approval
NortonLifeLock is finally set to complete its much ambitious acquisition of the London-listed rival cyber security firm, Avast Plc, as Britain’s competition regulator gave its final nod for the merger. The American consumer cyber safety provider now expects to close the deal on Sep 12.
NortonLifeLock already received regulatory approval from the U.S. Federal Trade Commission in November last year. The waiting period for a review of the transaction under the Hart-Scott-Rodino Act expired on Nov 12, 2021.
Why Does Avast Buyout Make Sense for NortonLifeLock?
U.S.-based NortonLifeLock and U.K.-based Avast Plc reached a merger agreement on Aug 10, under which the former agreed to acquire the latter in a cash-and-stock deal worth $8.6 billion.
NortonLifeLock Inc. Price and Consensus
NortonLifeLock Inc. price-consensus-chart | NortonLifeLock Inc. Quote
The merger will combine two broad and complementary product portfolios, thereby helping NortonLifeLock become a global leader in the consumer security software market. Avast makes free and premium security software for desktops and mobile devices, while NLOK primarily deals with consumer cyber safety.
The acquisition of Avast will help NortonLifeLock enhance its product portfolio and customer base. The U.S.-cybersecurity firm believes that this combination will untie their complementary product portfolio strength for more than 500 million users.
The merger will strengthen geographical diversification and will likely help NortonLifeLock expand its presence in the Small Offices/Home Offices cyber security and very small businesses markets.
NLOK believes that the combination will be accretive to its top and bottom-line growth. It projects that the acquisition will drive double-digit growth in earnings per share within the first full year following the completion of the transaction and double-digit growth in revenues over the long run.
The acquisition is also anticipated to strengthen the financial profile of the combined entity through cost synergies, increased scale, long-term growth and strong cash flow generation. NortonLifeLock estimates that the merger will create approximately $280 million of annual cost synergies.
Last month, NortonLifeLock reported solid results for the first quarter of fiscal 2023 despite ongoing macroeconomic headwinds, including inflationary pressure, supply-chain issues and the Russia-Ukraine war. The company’s first-quarter non-GAAP revenues increased 2% to $707 million, while non-GAAP earnings soared 7% to 45 cents per share.
Zacks Rank & Other Stocks to Consider
Currently, NortonLifeLock carries a Zacks Rank #2 (Buy). Shares of NLOK have decreased 12.1% year to date (“YTD”).
Some other top-ranked stocks from the broader Computer and Technology sector are Clearfield (CLFD - Free Report) , Silicon Laboratories (SLAB - Free Report) and Taiwan Semiconductor (TSM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Clearfield's fourth-quarter fiscal 2022 earnings has been revised upward by 10 cents to 80 cents per share over the past 60 days. For fiscal 2022, earnings estimates have moved 36 cents north to $3.13 per share in the past 60 days.
Clearfield’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 33.9%. Shares of CLFD have soared 18.2% YTD.
The Zacks Consensus Estimate for Silicon Laboratories’ third-quarter 2022 earnings has increased 36.1% to $1.13 per share over the past 60 days. For 2022, earnings estimates have moved 20.5% up to $4.41 per share in the past 60 days.
Silicon Laboratories’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 63.6%. Shares of SLAB have decreased 43.1% YTD.
The Zacks Consensus Estimate for Taiwan Semiconductor's third-quarter 2022 earnings has been revised a penny southward to $1.69 per share over the past 30 days. For 2022, earnings estimates have moved 37 cents north to $6.30 per share in the past 60 days.
TSM's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.9%. Shares of the company have decreased 32.7% YTD.