Symantec’s stock plunges over 30 percent amid internal investigation
Shares of Symantec Corp. tanked more than 33 percent today to their lowest level in nearly two decades following the revelation that it has launched a internal audit to investigate concerns brought by a former employee.
The cybersecurity company made shareholders aware of the probe during its fourth-quarter earnings call late Thursday. Executives scrapped their usual question-and-answer session with analysts, but Symantec did divulge some information in a statement.
The company said the audit doesn’t involve “any security concern or breach with respect to our products or system.” According to an anonymous insider who spoke with Reuters, it’s also unrelated to an investigation that was launched last November in connection with compensation awards granted to Symantec executives. Yet whatever it is, the matter is clearly significant.
Symantec said the audit will likely prevent it from filing its financial report for the year ended March 30 in a timely manner. The company’s warning, paired with the lack of details about exactly what’s being investigated, understandably has Wall Street concerned.
Besides today’s stock selloff, which is estimated to have shaved about $6 billion off Symantec’s market value, Symantec is also facing the prospect of legal action. CNBC reported that at least eight investor groups launched investigations into the company following the probe’s announcement. The analysts tracking the company’s stock responded sharply as well, with at least nine lowering their price targets so far.
Symantec’s disappointing forecast for fiscal year 2019 likely didn’t help the situation. The company expects to close the 12 months ended March 30 with revenues of between $4.76 billion to $4.9 billion, below the $4.93 billion that analysts predicted. Its projected profit of $1.50 to $1.65 per share missed estimates as well.
Image: Symantec
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