Some of the big news on WallStreet today includes Broadcom’s efforts to acquire Symantec Corp. [NASDAQ: SYMC]. The move is part of Broadcom’s [NASDAQ: AVGO] strategy of diversifying its product offering. This move follows similar moves by the company, including last year’s acquisition of software company CA Inc. It is also in line with industry trends, as other chip makers have been diversifying too. Back in 2011, Intel bought McAfee but later sold a major stake to TPG. Nonetheless, it is an indicator that chip makers want a more diversified revenue stream.
News of this move by Broadcom has sent Symantec stock into positive territory in pre-market trading. It’s a significant gain for a company that has lost close to a third of its value, ever since in peaked out at $34.20 in 2017. Symantec’s performance has largely been affected by its run-ons with regulators. As per an article published on Reuters, Symantec is being investigated by U.S regulators for accounting related issues. This has seen the company record high profile resignations in the past year, and job cuts to the tune of about 8%.
On its part, Broadcom has seen a slight decline in price since news of its move on Symantec became public. At yesterday’s close, Broadcom was down by about 1.67% to close at $295.33 yesterday and it appears Broadcom is taking another dive or hit in pre-market trading today.
U.S markets, especially the NASDAQ and the S&P 500, are also gaining positive momentum after slight weakness on Monday. On Tuesday, the markets closed higher, with the NASDAQ edging higher to close at 8109.09 points. If this momentum continues in the day, Symantec, with their news of a possible buyout from Broadcom, could experience significant price moves and fluctuations. Symantec is already leading the way in pre-market trading. On the flip side, keep an eye out for Broadcom because it is technically pulling back in pre-market and is trading down around $283.