Avast (AVST) 436p

Gain to date: 45.9%

Original entry point: Buy at 298.8p, 16 May 2019

Our positive call on online security firm Avast (AVST) remains comfortably in the money despite a recent setback for the firm.

It emerged that Avast, owner of anti-virus software AVG, had been selling customer data to companies through its subsidiary Jumpshot.

On 30 January the company announced that it would shut down the analytics business amid privacy concerns, but said the move would not hurt annual performance.

Despite a fairly rapid response from the company, the danger is that the high profile nature of the scandal could impact demand for its services as customers worry their internet activity is being snooped on.

Analysts at investment bank Jefferies are keeping things in perspective. They comment: ‘We note that some investors we have spoken to view the data collection as potentially damaging to Avast’s brand, however the impact to Avast’s business is likely to be small, with many investors noting that its sharing of user data has been known since the company’s IPO and that the company has followed all laws and regulations.’

SHARES SAYS: We will stick with the shares for now but will be watching developments closely to see if there is any further fallout from this episode.

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