McAfee Corp. (MCFE) is a pioneer and leader in protecting consumers, enterprises and governments from cyberattacks for over 30 years, with integrated security, privacy and trust solutions installed on over 600 million devices.
The company generated 54% of its revenue from consumers and 46% of its revenue from enterprise customers in 2020. In terms of diversification, the company generated 55% of its revenue from the United States and 45% of its revenue from the rest of the world, while 14% of its total revenue came from a single distributor, Ingram Micro Inc.
Restructuring Boosts Shares
McAfee recently announced plans to sell its enterprise business to Symphony Technology Group for $4 billion in cash, which would effectively transform the business into a pure play consumer cybersecurity business. As part of the transaction, the company would also reduce its debt by $1 billion and issue a $4.50 per Class A share special dividend.
Several analysts believe that the divestiture represents a favorable outcome for McAfee, estimating the company’s sum-of-parts valuation at $3.4-3.5 billion. RBC Capital believes that the transaction will enable management to narrow its focus on the consumer segment and potentially generate double-digit growth rates.
The company raised its quarterly dividend by 32.2% to $0.115 per share, which represents a 1.94% forward yield. The dividend is payable on April 9, 2021, to shareholders on record as of March 26, 2021.
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