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IPO Report: FireEye (FEYE)

By  +Follow September 19, 2013 2:12PM
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FireEye ($FEYE) invented a purpose-built, virtual machine-based security platform that provides real-time protection to enterprises and governments worldwide against the next generation of cyber attacks.

FEYE is one of nine IPOs are scheduled for this week, 12 for next week. The full IPO calendar can be found at IPOpremium

FEYE is based in Milpitas, CA, and scheduled a $182 million IPO with a market capitalization of $1.5 billion million at a price range mid-point of $13, for Friday, September 20, 2013.

The S-1 was filed September 9, 2013.  Manager, Joint Managers: Morgan Stanley; Goldman; J.P. Morgan; Barclays.  Co-Managers: BofA Merrill LynchUBS Securities/ Nomura

Summary

For the six months ended June 2013 revenue reached $62 million, with 48% from subscriptions. Losses reached-$63 million from $14 million in the year earlier period.

Operating expenses increased from $13.5mm to $63.5mm for June '13 vs June '12

 

2010 yr

2011 yr

2012 yr

June 6 mos '12

June 6 mos '13

Revenue % chg vs prior period

183%

144%

 

107%

Valuation

Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

% offered

June '13 12 mos

Cap (mm)

Sls

Erngs

BkVlue

TanBV

in IPO

FireEye

$1,512

12.2

-12.0

11.8

12.4

12%

             

Glossary

Accumulated deficit of -$170 million.

FEYE appears to be in a sweet spot as long as it invests heavily in sales, marketing and product development, which is what that are doing.

The high cost of customer acquisition is a concern, the market appears very large, and FEYE appears to be targeting early adopters.

Conclusion
Buy on the IPO. FEYE is a high risk investment that might pay off. In this stock market top line revenue growth with a branded product/service (especially a subscription service) is highly valued.

Business
FEYE invented a purpose-built, virtual machine-based security platform that provides real-time protection to enterprises and governments worldwide against the next generation of cyber attacks.

FEYE's technology approach represents a paradigm shift in how IT security has been conducted since the earliest days of the information technology industry.

The core of FEYE's purpose-built, virtual machine-based security platform is virtual execution, or MVX, engine, which identifies and protects against known and unknown threats that existing signature-based technologies are unable to detect.

The new generation of cyber attacks on organizations, including large and small enterprises and governments worldwide, is characterized by an unprecedented escalation in the complexity and scale of advanced malware created by criminal organizations and nation-states.

Marketing & Sales
FEYE's sells the majority of its products, subscriptions and services to end-customers through distributors, resellers, and strategic partners, with a lesser percentage of sales directly to end-customers.

Customer concentration
Accounts receivable
As of December 31, 2011, two customers represented 23% and 16% of gross accounts receivable.

As of December 31, 2012, two customers represented 14% and 10% of gross accounts receivable.

As of June 30, 2013, two customers represented 18% and 12% of gross accounts receivable.

Revenue
During the year ended December 31, 2010, two customers represented 12% and 12% of total revenue.

During the year ended December 31, 2011, one customer represented 12% of our total revenue. During the year ended December 31, 2012, one customer represented 10% of total revenue.

During the six months ended June 30, 2012, two customers represented 14% and 11% of total revenue.

During the six months ended June 30, 2013, two customers represented 11% and 10% of total revenue.

Intellectual Property
FEYE has five U.S. issued patents and 43 patent applications pending in the United States. FEYE also has a number of foreign counterparts of these patent applications, consisting of two pending applications under the Patent Cooperation Treaty, a pending application in the European Patent Office and another in Japan.

Issued patents expire between 2025 and 2030. FEYE has five U.S. issued patents and 43 patent applications pending in the United States.

FEYE also have a number of foreign counterparts of these patent applications, consisting of two pending applications under the Patent Cooperation Treaty, a pending application in the European Patent Office and another in Japan.

Competition
Current and potential future competitors fall into five general categories:

large networking vendors such as Cisco and Juniper that may emulate or integrate features similar to FEYE's into their own products;

large companies such as Intel, IBM and HP that have acquired large IT security specialist vendors in recent years and have the technical and financial resources to bring competitive solutions to the market;

independent security vendors such as Sourcefire (which recently announced its pending acquisition by Cisco), Palo Alto Networks and Trend Micro that offer products that claim to perform similar functions to FEYE's platform;

small and large companies that offer point solutions that compete with some of the features present in FEYE's platform; and

providers of traditional IT security solutions, such as Symantec, that we may compete with in the future.

5% stockholders pre-IPO
Sequoia Capital Entities, 21.1%
Norwest Venture Partners Entities, 20.3%
Ashar Aziz, 10.6%
DAG Ventures Entities, 10.2%
JAFCO Technology Partners Entities, 7.4%
SVB Entities, 6.2%

Use of Proceeds
FEYE expects to net $166 million from its IPO. Proceeds are allocated to working capital and general corporate purposes.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for feye
SiⓂ✪n™
30 Aug 14 18:02:15
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30 Aug 14 17:45:44
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Johnny Trades
30 Aug 14 16:47:25
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30 Aug 14 16:19:36
$FEYE: Raymond James: Hewlett Packard Likely On The Hunt For Acquisitions http://t.co/0ScjcvH8sp http://t.co/jqttkTu7JB
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30 Aug 14 15:19:39
$FEYE: Most Active Stocks Coverage: FireEye Inc (NASDAQ:FEYE), Glu Mobile Inc ... http://t.co/6eB4kxBRzn http://t.co/byNHdCZ2N8
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30 Aug 14 15:03:56
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Charlie Baker
30 Aug 14 12:29:28
$FEYE closed back above the 8 & 21EMA this week. watching for a break of the 50ema http://t.co/CkkHMjnvM5
John Ross
30 Aug 14 12:19:32
@WillGriscom $FEYE #wood http://t.co/2HdVXJaKoz
Stock007
30 Aug 14 11:23:08
@MartyChargin Way rather be in $FEYE & $FTNT etc... as prime examples
Bulls vs Bears
30 Aug 14 11:19:32
$FEYE: FireEye, Palo Alto Top Security Picks at Stifel; SYMC, CHKP, FTNT a Hold http://t.co/oeaNYEmLta http://t.co/PeKHMeQm0D
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30 Aug 14 10:42:02
Just had some $CMG and got a little $FEYE. Sure did help un $PLUG me though!
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30 Aug 14 10:36:41
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Investors Hangout
30 Aug 14 10:34:37
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danrocks
30 Aug 14 10:25:55
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danrocks
30 Aug 14 10:08:56
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Jake13
30 Aug 14 09:56:45
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Stock Market News
30 Aug 14 09:19:31
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lookn4wins
30 Aug 14 09:19:14
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Investors Hangout
30 Aug 14 09:16:37
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Investors Hangout
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iHangout
30 Aug 14 09:01:07
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lookn4wins
30 Aug 14 08:25:11
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Jake13
30 Aug 14 08:22:11
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Business News Now
30 Aug 14 08:19:35
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30 Aug 14 08:15:11
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Investors Hangout
30 Aug 14 08:15:11
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Rick  dan
30 Aug 14 08:12:02
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Investors Hangout
30 Aug 14 08:00:41
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30 Aug 14 08:00:40
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30 Aug 14 07:56:44
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30 Aug 14 07:30:38
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30 Aug 14 07:30:38
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Market Monitor
30 Aug 14 07:19:36
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danrocks
30 Aug 14 07:15:34
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OPTIONS/STOCK EXPERT
30 Aug 14 06:53:28
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30 Aug 14 05:18:47
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30 Aug 14 03:03:47
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Anthony
29 Aug 14 23:35:17
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Alpha Maven Alerts
29 Aug 14 21:29:32
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Stock News Headlines
29 Aug 14 21:19:32
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29 Aug 14 20:40:54
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29 Aug 14 20:38:27
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29 Aug 14 19:29:13
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Nelson
29 Aug 14 18:21:02
@mathman6577 @Benzinga I've been loading up on $feye all week
				
				
By  +Follow September 19, 2013 2:12PM
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