FireEye Inc (NASDAQ:FEYE) shares are up considerably in early afternoon trading today, bucking the general trend of the market as the Dow has slipped over 340 points. The main catalyst for the stock seems to be a recent initiation of shares at a ‘Buy’ rating and a $35 price traget by Summit Research.
“We are initiating coverage of FireEye with a BUY rating and a $35 PT, based on EV/C2016 sales multiple of 6.0x, inline with the high growth security peer group average,” explained Summit Research Analyst Srini Nandury. “While the company is the gold standard in the industry to intercept and remediate APT (Advanced Persistent Threats), the recent execution missteps in Europe lead to a significant billings miss in F3Q15. Combined with the departure of key people (CFO & CTO), the sentiment on the stock is bearish with the stock pulling back to multi-year lows. The stock is currently trading at 3.7x on an EV/Sales multiple versus the security peer group at 6.1x (FEYE is cheap despite having growth of 28% versus the peer average of 25%). While it is entirely possible that the company can provide 2016 revenue/billings outlook that is below consensus, we believe the pullback of shares from current levels is limited. Also providing support for the stock is our belief that FireEye could make a very attractive potential acquisition. Therefore, with limited downside, we believe the risk/reward profile is favorable to investors who can weather the uncertainty that comes with owning the stock in the near-term.”
With a share price just south of $22, there could be plenty of room for FireEye Inc (NASDAQ:FEYE) to run over the year ahead. The stock is down over 60% from its highs seen in June of last year. The stock is up 5.95% or $1.23 following the news, hitting $21.97 per share. About 2.88 million shares traded hands. FEYE has declined 55.46% since May 29, 2015 and is downtrending. It has underperformed the S&P500 by 52.45%.
From a total of 19 analysts covering Fireeye Inc (NASDAQ:FEYE) stock, 7 rate it a “Buy”, 0 a “Sell”, and 12 a “Hold”. This means that 37% of the ratings are positive. The highest target price is $65 while the lowest target price is $26. The mean of all analyst targets is $37.76 which is 71.87% above today’s ($21.97) stock price. Fireeye Inc was the topic of 30 analyst reports since July 24, 2015 according to the firm StockzIntelligence Inc. Evercore initiated shares on December 15 with a “Buy” rating. Morgan Stanley maintained shares with a”Equal-Weight” rating and a $26 target share price in their report from a November 5. Imperial Capital maintained FEYE stock in a recent report from November 6 with a “Outperform” rating. Wedbush maintained the rating on November 5. Wedbush has a “Neutral” rating and a $27 price target on shares. Finally, Oppenheimer maintained the stock with a “Outperform” rating in a report they issued on a November 5.
The institutional sentiment decreased to 1.31 in Q2 2015. It’s down 0.27, from 1.58 in 2015Q2. The ratio dropped, as 73 funds sold all their FireEye Inc shares they owned while 86 reduced their positions. 41 funds bought stakes while 167 increased their total positions. Institutions now own 101.75 million shares which is 11.68% more than the previous share count of 91.11 million in 2015Q2.
Trellus Management Company Llc holds 12.83% of its total portfolio in FireEye Inc, equating to 274,788 shares. Terril Brothers Inc. owns 968,100 shares representing 9.97% of their total US portfolio. Moreover, Messner & Smith Theme Value Investment Management Ltd Ca has 5% of their total portfolio invested in the company, equating to 79,459 shares. The California-based Bodri Capital Management Llc has a total of 4.75% of their portfolio invested in the stock. Srs Investment Management Llc, a New York-based fund reported 4.48 million shares owned.
Since March 9, 2015, the stock had 0 buys, and 9 insider sales for a total of $30.46 million in net activity. Aziz Ashar sold 188,434 shares worth $5.50M. Codd Ronald E F sold 3,000 shares worth $91,170. Mcgee John T sold 17,542 shares worth $749,203. King Alexa sold 13,000 shares worth $681,562. The insider Lentz Robert F sold 72,728 shares worth $3.50M.
FireEye, Inc. provides cybersecurity solution for detecting, preventing and resolving cyber-attacks. The company has a market cap of $3.44 billion. The Company’s cybersecurity solutions combine its virtual-machine technology, threat intelligence and security in a suite of services and products. It currently has negative earnings. The Company’s virtual machine technology delivers detection and prevention, and to provide real-time protection to enterprises and governments across the world.