Gen Digital (NASDAQ:GEN) Trading Down 6% - What's Next?

Key Points

• Gen Digital shares fell 6% to about $27.40 in mid-day trading, with volume significantly below its average.
• Analyst sentiment remains cautious: the stock has a consensus “Hold” rating and an average price target of $31.60, despite several firms recently raising their targets.
• The company reported better-than-expected quarterly results, with $0.71 EPS and $1.34 billion in revenue, while maintaining a quarterly dividend of $0.125 per share, equivalent to a 1.8% yield.

Gen Digital Inc. (NASDAQ:GEN - Get Free Report)'s stock price dropped 6% on Tuesday . The stock traded as low as $27.64 and last traded at $27.3990. Approximately 1,866,670 shares were traded during mid-day trading, a decline of 72% from the average daily volume of 6,566,205 shares. The stock had previously closed at $29.15.

Analysts Set New Price Targets

A number of equities analysts recently issued reports on GEN shares. Wells Fargo & Company upped their price objective on shares of Gen Digital from $22.00 to $28.00 and gave the stock an "equal weight" rating in a research report on Friday, August 7th. Wall Street Zen cut shares of Gen Digital from a "buy" rating to a "hold" rating in a research note on Sunday, August 16th. Barclays upped their price target on shares of Gen Digital from $27.00 to $32.00 and gave the stock an "equal weight" rating in a report on Friday, August 7th. Weiss Ratings raised Gen Digital from a "hold (c)" rating to a "hold (c+)" rating in a report on Wednesday, July 15th. Finally, Royal Bank Of Canada upped their target price on Gen Digital from $27.00 to $30.00 and gave the stock a "sector perform" rating in a report on Friday, August 7th. One equities research analyst has rated the stock with a Strong Buy rating, one has assigned a Buy rating and six have given a Hold rating to the company's stock. According to data from MarketBeat, the stock presently has a consensus rating of "Hold" and an average target price of $31.60.

Gen Digital Price Performance

The stock has a market cap of $16.34 billion, a P/E ratio of 15.85, a price-to-earnings-growth ratio of 0.92 and a beta of 1.22. The business has a 50-day simple moving average of $28.69 and a 200 day simple moving average of $24.64. The company has a current ratio of 0.47, a quick ratio of 0.47 and a debt-to-equity ratio of 3.00.

Gen Digital (NASDAQ:GEN - Get Free Report) last posted its quarterly earnings data on Thursday, August 6th. The company reported $0.71 EPS for the quarter, topping analysts' consensus estimates of $0.69 by $0.02. Gen Digital had a return on equity of 55.93% and a net margin of 20.73%.The company had revenue of $1.34 billion for the quarter, compared to analyst estimates of $1.31 billion. During the same period in the previous year, the firm earned $0.64 earnings per share. The firm's quarterly revenue was up 6.3% on a year-over-year basis. Gen Digital has set its FY 2027 guidance at 2.870-2.970 EPS and its Q2 2027 guidance at 0.710-0.730 EPS. On average, analysts forecast that Gen Digital Inc. will post 2.64 earnings per share for the current year.

Gen Digital Announces Dividend

The company also recently declared a quarterly dividend, which was paid on Wednesday, September 9th. Shareholders of record on Monday, August 17th were given a dividend of $0.125 per share. The ex-dividend date of this dividend was Monday, August 17th. This represents a $0.50 dividend on an annualized basis and a yield of 1.8%. Gen Digital's dividend payout ratio is 29.07%.

Insiders Place Their Bets

In related news, insider Travis Witteveen sold 30,000 shares of the company's stock in a transaction dated Monday, August 10th. The stock was sold at an average price of $29.42, for a total transaction of $882,600.00. Following the sale, the insider owned 496,545 shares in the company, valued at $14,608,353.90. This represents a 5.70% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, Director Ondrej Vlcek sold 200,000 shares of the firm's stock in a transaction that occurred on Thursday, August 27th. The stock was sold at an average price of $30.00, for a total value of $6,000,000.00. Following the sale, the director directly owned 3,332,904 shares of the company's stock, valued at $99,987,120. This represents a 5.66% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders sold 558,508 shares of company stock worth $16,356,093. Company insiders own 9.70% of the company's stock.

Hedge Funds Weigh In On Gen Digital

Several institutional investors have recently made changes to their positions in GEN. Boston Partners raised its stake in Gen Digital by 14.3% during the 4th quarter. Boston Partners now owns 15,644,289 shares of the company's stock worth $425,336,000 after buying an additional 1,954,712 shares during the period. Geode Capital Management LLC raised its position in shares of Gen Digital by 0.8% during the fourth quarter. Geode Capital Management LLC now owns 15,592,196 shares of the company's stock worth $422,461,000 after purchasing an additional 129,413 shares during the period. Arrowstreet Capital Limited Partnership raised its position in shares of Gen Digital by 45.8% during the first quarter. Arrowstreet Capital Limited Partnership now owns 13,094,386 shares of the company's stock worth $246,567,000 after purchasing an additional 4,115,676 shares during the period. Legal & General Group Plc lifted its holdings in shares of Gen Digital by 3.8% in the 4th quarter. Legal & General Group Plc now owns 9,085,216 shares of the company's stock worth $247,027,000 after purchasing an additional 334,156 shares in the last quarter. Finally, Deutsche Bank AG acquired a new stake in Gen Digital in the 2nd quarter valued at $146,639,000. Institutional investors and hedge funds own 81.38% of the company's stock.

About Gen Digital

Gen Digital Inc NASDAQ: GEN is a global cybersecurity and consumer safety company that provides products designed to help individuals and families protect their devices, online identities, personal information and digital privacy. The company serves customers through a portfolio of consumer-focused cybersecurity and privacy brands.

Its products and services include antivirus and device security, identity theft protection, virtual private networks, password management, online privacy tools, scam protection and family safety features.

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