FireEye (FEYE) Beats Low Expectations but Price Target Lowered at Deutsche Bank on Sector Re-Valuation
Deutsche Bank maintained a Hold rating on FireEye, Inc (NASDAQ: FEYE) but lowered its price target to $20.00 (from $30.00). Comments follow FireEye's positive pre-announcement. Analyst Karl Keirstead maintain a Hold rating due to FireEye's "balanced risk reward profile." The price target change relates to re-valuation across the software sector.
"FireEye (FEYE) pre-announced a modest 4Q15 revs beat and set preliminary 2016 guidance ahead of the Feb 11 earnings report date, likely in response to the material recent sell-off in the stock (down 30% in the last 2 weeks). In our view the reported numbers beat the low Street expectations. FEYE also announced the acquisition of privately-held threat intelligence software vendor iSIGHT for $275m ($200m in cash, $75 in earn-outs), equal to 5-6x 2015 billings of $50m and 7x 2015 revs of $40m. We like this security segment and the deal rationale/economics seem reasonable," said Keirstead.
"FireEye (FEYE) pre-announced a modest 4Q15 revs beat and set preliminary 2016 guidance ahead of the Feb 11 earnings report date, likely in response to the material recent sell-off in the stock (down 30% in the last 2 weeks). In our view the reported numbers beat the low Street expectations. FEYE also announced the acquisition of privately-held threat intelligence software vendor iSIGHT for $275m ($200m in cash, $75 in earn-outs), equal to 5-6x 2015 billings of $50m and 7x 2015 revs of $40m. We like this security segment and the deal rationale/economics seem reasonable. Maintain HOLD rating due to balanced risk reward profile," added the analyst.
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Shares of FireEye, Inc closed at $14.87 yesterday.