FireEye’s 3Q Profit Explodes 450%; Shares Rise 4%

Shares of FireEye rose 4% in Tuesday’s extended trading session after the cybersecurity company’s 3Q EPS jumped more than five-fold to $0.11 year-over-year and handily surpassed analysts’ estimates of $0.07 per share.

FireEye’s (FEYE) 3Q revenues grew 6% to $238 million year-on-year and beat Street estimates of $227.7 million. The company’s CEO Kevin Mandia said, “Our third quarter results reflect the progress we have made transforming our business. We delivered record revenue, and record non-GAAP operating income, operating margin, and earnings per share as our revenue mix continued to shift to higher growth Mandiant Solutions compared to the third quarter of 2019.”

Buoyed by the stronger-than-expected 3Q results, FireEye raised its full-year outlook. The company now projects 2020 revenues between $930-$934 million, up from the earlier expectations of $905-$925 million. Adjusted EPS is forecasted to be in the range of $0.28-$0.30, up from the previous guidance range of $0.22-$0.26. (See FEYE stock analysis on TipRanks).

For the 4Q, the company expects revenues to land between $237-$241 million and adjusted EPS to be in the range of $0.09-$0.11. Analysts expect the company to report sales and EPS of $236.4 million and $0.10 per share, respectively.

Ahead of the earnings, Robert W. Baird analyst Jonathan Ruykhaver called the stock a “positive Fresh Pick” and reiterated a Buy rating with a price target of $18 (27.8% upside potential). In a note to investors on Oct. 14, Ruykhaver said that the stock looks attractive on valuation front given its underperformance following strong 2Q results. Shares down almost 15% on a year-to-date basis.

Currently, the Street is cautiously optimistic on the stock. The Moderate Buy analyst consensus is based on 4 Buys and 6 Holds. , the average price target of $16.75 implies upside potential of about 18.9% to current levels.