McAfee Posts Upbeat Q3 Results, Revenues Rise 24%

Cybersecurity company McAfee Corp. (MCFE) has reported better-than-expected financial results for the third quarter ended September 25 on the back of increased consumer adoption of digital services.

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Based out of California, McAfee offers integrated security, privacy and trust solutions to protect consumers, enterprises and governments from cyberattacks. (See Insiders’ Hot Stocks on TipRanks)

Q3 Results

Adjusted earnings stood at $0.31 per share, beating the Street’s estimate of $0.22 per share.

Net revenue rose 24% year-over-year to $491 million, exceeding analysts’ expectations of $465.84 million.

Adjusted EBITDA increased to $234 million from $164 million reported in the third quarter of 2020.

New Direct-to-Consumer subscribers grew 16% year-over-year to 20.1 million.

Management Comments

The Executive Vice-President and Chief Financial Officer of McAfee, Venkat Bhamidipati, said, “We delivered solid results in Q3, as continued strong demand for our holistic consumer security offerings, across our diversified global go-to-market channels, coupled with our focus on operational discipline.”

Wall Street’s Take

Following the release of the third-quarter results, Mizuho Securities analyst Gregg Moskowitz downgraded the rating on the stock to Hold from Buy and lowered the price target from $27 to $26 (2.1% upside potential).

Additionally, while UBS (UBS) analyst Roger Boyd maintained a Hold rating on McAfee, he reduced the price target to $26 from $29 (2.1% upside potential).

Analyst Recommendation

Overall, the stock has a Hold consensus rating based on 2 Buys and 6 Holds. The average McAfee price target of $27.38 implies 7.5% upside potential. Shares have gained almost 54.6% over the past year.

Smart Score

According to TipRanks’ Smart Score rating system, McAfee scores a 4 out of 10, suggesting that the stock is likely to perform in line with market averages.