By Michele Maatouk
Date: Friday 10 Jul 2020
LONDON (ShareCast) - (Sharecast News) - Peel Hunt upped its price target on cybersecurity company Avast to 355p from 322p on Friday, citing higher revenue expectations as people spend more time on their computers due to the Covid-19 pandemic.
The broker, which rates the stock at 'sell', said it also expects Avast to continue to benefit from the growing demand for privacy products.
Peel said that as Avast mentioned in its first-quarter trading update, the impact of Covid-19 has been net positive, as it has for competitors such as Kape.
"Although"Avast experienced weaker trends in small and midsize businesses (SMB) and its indirect channel was hit by lower ad spend, the desktop unit outperformed, meaning the net impact was positive given the latter's size.
"We expect these benefits to continue over the following quarters, as revenues are recognised over the contract length, typically one year or more."
As a result, the broker upgraded its FY20 adjusted revenue estimate from $874.7m to $896.9m.
"However, we still believe long-term risks remain and are not priced in sufficiently," it said.
At 1425 BST, the shares were up 2.2% at 566p.
|52 Week High||600.00p|
|52 Week Low||420.00p|
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