Gen Digital gains on Morgan Stanley's rating upgrade

Gen Digital

21/11/2023 16:50

** Shares of Gen Digital  GEN.O  up 2% at $21.21 after
Morgan Stanley upgrades the cybersecurity firm to "overweight"
from "equal-weight"
    ** Stock had hit its highest level in over nine months in
premarket trading 
    ** Morgan Stanley sees stable revenue growth, driven by
improving personal computer demand, higher average revenue per
user and growing retention rates 
    ** Expects operating margin to improve from 55% to ~60% FY25
onwards as synergies from mergers and acquisitions are realized
    ** All factors to drive double-digit compound annual growth
rate for co's EPS - MS
    ** Brokerage raises PT on stock to $26 from $23; an upside
of 25% to co's last close 
    ** Of eight analysts covering co's stock, six rate the stock
"buy" or higher and two rate "hold"; median PT is $25.50 - LSEG
data 
    ** Stock down 1% YTD, including session's gains

 (Reporting by Purvi Agarwal in Bengaluru)
 ((Purvi.Agarwal@thomsonreuters.com))