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Symantec starts internal investigation, $6 billion lost

Staff Writer |
Symantec disclosed that it is conducting an internal investigation that will delay the filing of its annual report and could potentially lead to a restatement of earnings.

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The news was reported in the quarterly results late Thursday, and when analysts started asking questions, they were shut down.

The company cut short the post-earnings conference call and canceled its scheduled callbacks later in the evening. That left analysts to fill in the blanks. And they imagined the worst.

"We believe this raises a red flag as it relates to the potential severity of this issue," said Anne Meisner, an analyst at Susquehanna International Group, in a note to clients. She has a neutral rating on the stock and lowered its price target to $24.

The shares tanked 33.1% to $19.52 on Friday, taking about $6 billion in market value with them. At least 10 analysts lowered their price targets or ratings on the stock. The company's bonds fell too.

Symantec said the board's audit committee is looking into "concerns raised by a former employee." The board has retained outside counsel to advise it and alerted the U.S. Securities and Exchange Commission.

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