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Buyouts, Product Launches to Fuel FireEye (FEYE) Q4 Earnings
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FireEye Inc. is slated to release fourth-quarter 2017 results on Feb 8. The question lingering in investors’ minds is if this cybersecurity company will be able to deliver a positive earnings surprise in the to-be-reported quarter. Notably, FireEye has delivered a positive earnings surprise for 14 straight quarters. In the trailing four quarters, the company delivered a remarkable average positive surprise of 64%. Let’s see how things are shaping up prior to this announcement.
What to Expect?
The Zacks Consensus Estimate for the quarter under review is pegged at a loss of a penny, which is narrower than the year-ago quarter’s loss of 3 cents. Additionally, analysts polled by Zacks project revenues of roughly $193.6 million, up 4.8% from the year-ago quarter tally.
What’s Driving the Better-Than-Expected Earnings?
FireEye is a specialized provider of a security platform against cyber-attacks to enterprises and governments. The company’s consistent efforts toward bringing in new and advanced products have been attracting a wide range of customers. Notably, FireEye’s Essentials product, which is a lower-cost and simpler version of the FireEye Global Threat Management platform, targets smaller and mid-market companies. The company’s Cloud MVX and MVX Smart Grid offerings, a lower-cost intelligent threat-detection solution, targets large enterprises and mid-market businesses. Analysts covering the stock believe the company’s continued focus on enhancing its product capabilities will bring in new customers, in turn, driving its top-line performance further.
Additionally, FireEye’s strategic acquisitions are anticipated to drive growth. It’s acquisition of iSIGHT Partners in 2016 has strengthened the company’s capabilities by offering an intelligence-led security model for enterprises of any size which other security providers find difficult to match. FireEye has also taken over Invotas, a firm specializing in improving response times following a cyber-attack. Its product — Security Orchestrator — is designed to compile information from a range of security products and automate responses when an incident occurs. These acquisitions will likely be beneficial for the company’s to-be-reported quarterly results.
Furthermore, the company’s move of shifting its business model to subscription-based cloud services from selling software is praiseworthy. Though shifting the business model to subscription-based services will generate lower revenues initially, but the same will remain stable over the long run, as organizations usually renew subscriptions with the existing products or even with higher versions. Moreover, subscription-based services generate higher gross margins. We believe though a shift in business model might offset the benefit of higher revenues from product launches and acquisitions, it will support the company’s bottom-line results.
Our proven model conclusively shows that FireEye is likely to beat earnings estimates this quarter. Per our model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold), has higher chance of beating estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. FireEye currently carries a Zacks Rank #3 and has an Earnings ESP of +25.00%.
Some Other Stocks With Favorable Combination
Here are a few companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:
Vishay Intertechnology, Inc. (VSH - Free Report) , with an Earnings ESP of +6.19% and a Zacks Rank of 2.
Akamai Technologies, Inc. (AKAM - Free Report) , with an Earnings ESP of +2.73% and a Zacks Rank #3.
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It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation. See Them Free>>
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Buyouts, Product Launches to Fuel FireEye (FEYE) Q4 Earnings
FireEye Inc. is slated to release fourth-quarter 2017 results on Feb 8. The question lingering in investors’ minds is if this cybersecurity company will be able to deliver a positive earnings surprise in the to-be-reported quarter. Notably, FireEye has delivered a positive earnings surprise for 14 straight quarters. In the trailing four quarters, the company delivered a remarkable average positive surprise of 64%. Let’s see how things are shaping up prior to this announcement.
What to Expect?
The Zacks Consensus Estimate for the quarter under review is pegged at a loss of a penny, which is narrower than the year-ago quarter’s loss of 3 cents. Additionally, analysts polled by Zacks project revenues of roughly $193.6 million, up 4.8% from the year-ago quarter tally.
What’s Driving the Better-Than-Expected Earnings?
FireEye is a specialized provider of a security platform against cyber-attacks to enterprises and governments. The company’s consistent efforts toward bringing in new and advanced products have been attracting a wide range of customers. Notably, FireEye’s Essentials product, which is a lower-cost and simpler version of the FireEye Global Threat Management platform, targets smaller and mid-market companies. The company’s Cloud MVX and MVX Smart Grid offerings, a lower-cost intelligent threat-detection solution, targets large enterprises and mid-market businesses. Analysts covering the stock believe the company’s continued focus on enhancing its product capabilities will bring in new customers, in turn, driving its top-line performance further.
Additionally, FireEye’s strategic acquisitions are anticipated to drive growth. It’s acquisition of iSIGHT Partners in 2016 has strengthened the company’s capabilities by offering an intelligence-led security model for enterprises of any size which other security providers find difficult to match. FireEye has also taken over Invotas, a firm specializing in improving response times following a cyber-attack. Its product — Security Orchestrator — is designed to compile information from a range of security products and automate responses when an incident occurs. These acquisitions will likely be beneficial for the company’s to-be-reported quarterly results.
Furthermore, the company’s move of shifting its business model to subscription-based cloud services from selling software is praiseworthy. Though shifting the business model to subscription-based services will generate lower revenues initially, but the same will remain stable over the long run, as organizations usually renew subscriptions with the existing products or even with higher versions. Moreover, subscription-based services generate higher gross margins. We believe though a shift in business model might offset the benefit of higher revenues from product launches and acquisitions, it will support the company’s bottom-line results.
FireEye, Inc. Price and EPS Surprise
FireEye, Inc. Price and EPS Surprise | FireEye, Inc. Quote
What the Zacks Model Unveils?
Our proven model conclusively shows that FireEye is likely to beat earnings estimates this quarter. Per our model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold), has higher chance of beating estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. FireEye currently carries a Zacks Rank #3 and has an Earnings ESP of +25.00%.
Some Other Stocks With Favorable Combination
Here are a few companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:
NVIDIA Corporation (NVDA - Free Report) has an Earnings ESP of +6.87% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Vishay Intertechnology, Inc. (VSH - Free Report) , with an Earnings ESP of +6.19% and a Zacks Rank of 2.
Akamai Technologies, Inc. (AKAM - Free Report) , with an Earnings ESP of +2.73% and a Zacks Rank #3.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>