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FireEye (FEYE) to Report Q4 Earnings: What's in the Offing?

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FireEye, Inc. is scheduled to report fourth-quarter 2018 results on Feb 6.

In the last reported quarter, the company reported earnings per share of 6 cents, beating the Zacks Consensus Estimate of 2 cents.

Revenues of $211.7 million reflected a year-over-year increase of 11.6%. Also, the top line beat the consensus estimate of $208.4 million.

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 5 cents, indicating a 400% surge on a year-over-year basis. Revenues are estimated to be around $216.54 million, indicating a 7.05% increase.

Let's see how things are shaping up for the upcoming announcement.

Factors at Play

FireEye is benefiting from growth in virtual deployments and Cloud MVX, which is expected to drive subscriptions.

The company is optimistic about strength in Managed Defense, stand-alone iSIGHT Threat Intelligence, Helix subscriptions and cloud e-mails, which are witnessing strong adoption.

Launched in the third quarter, The FireEye marketplace, which had already been downloaded a few hundred times in the first month of its launch, is expected to have gained strong momentum in the to-be-reported quarter.

FireEye is gaining customer accounts, which are driving revenue growth. Innovation in its Network and Email Security products is boosting adoption of cloud and virtual appliances, which is reflected in the growing number of new and renewal customers. This is expected to continue driving the company’s top line.

Moreover, FireEye’s click-to-try for our e-mail security service is also likely to penetrate deeper into the market.

Furthermore, improved operational efficiency and sales productivity are expected to boost FireEye’s operating results.

However, the company faces stiff competition from several big and small players in the security application market. Further, rising demand for IT security has made the market more attractive for new players.

There are some established players in adjacent markets like Cisco (CSCO - Free Report) and Juniper Networks (JNPR - Free Report) that are taking aggressive steps in the cyber-security space, further intensifying competition.

Moreover, the declining trend in the weighted average contract length for product and related billings has resulted in the decrease in appliance sales. This is expected to remain an overhang.

FireEye, Inc. Price and EPS Surprise

FireEye, Inc. Price and EPS Surprise | FireEye, Inc. Quote

What the Zacks Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

FireEye has a Zacks Rank #2 and an Earnings ESP of 0.00%.

A Stock to Consider

Here is a stock that you may consider as our model shows that this has the right combination of elements to post an earnings beat in its upcoming release:

Archer Daniels Midland Company (ADM - Free Report) has an Earnings ESP of +2.45% and sports a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

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