Back to top

Image: Bigstock

FireEye (FEYE) to Report Q2 Earnings: What's in the Cards?

Read MoreHide Full Article

FireEye Inc. is scheduled to report second-quarter 2017 results on Aug 1. Last quarter, the company posted a positive earnings surprise of 40.3%. Let’s see how things are shaping up for this announcement.

Factors to Consider

FireEye’s management has been striving to turn the business around through a string of initiatives, which includes product launches, acquisition and cost optimization. We are of the opinion that the company’s turnaround strategies are paying off as reflected from its sterling first-quarter results, and solid outlook for the second quarter and full year.

Going ahead, despite persistent macro uncertainty, the company appears optimistic due to a healthy security market, strong product line-up, deal wins and investment plans, which are likely to boost results in the long run.

Furthermore, FireEye’s strategy of growing through acquisitions is encouraging, the latest being the buyout of iSIGHT Partners during the first quarter. The deal has reinforced FireEye’s cyber security suite and enhanced its competitive dynamics.

However, the company has been losing business to its rivals in the past several quarters. FireEye faces stiff competition from other well-established players such as Check Point Software (CHKP - Free Report) and Fortinet in the cyber security space.

FireEye, Inc. Price and EPS Surprise

Earnings Whispers

Our proven model does not conclusively show that FireEyeis likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here, as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 39 cents per share. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: FireEyecarries a Zacks Rank #3. Though Zacks Rank #1, 2 or 3 increases the predictive power of ESP, the company’s ESP of 0.00% makes surprise prediction difficult.

We caution against stocks with a Zacks Rank #4 and 5 (Sell rated) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.

Stocks to Consider

Here are a couple of companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:

Fiserv, Inc. , with an Earnings ESP of +1.63% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Pandora Media, Inc. , with an Earnings ESP of +17.95% and a Zacks Rank #3.

The Hottest Tech Mega-Trend of All            

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaries,"" but that should still leave plenty of money for regular investors who make the right trades early.

 See Zacks' 3 Best Stocks to Play This Trend >>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Check Point Software Technologies Ltd. (CHKP) - free report >>

Published in