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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
Cosmic Events, LLC
21 Oct 14 17:54:41
RT @jimcramer: Maybe because $PANW is better than $FEYE-@JDR1024
Options Gains
21 Oct 14 16:17:16
“@Taarriqq: $FEYE getting a bounce on november calls block buy, details @optionsstats”
John L. Bair
21 Oct 14 15:09:33
RT @ACInvestorBlog: Stocks to Watch for October 22, 2014 http://t.co/v3kUNdHokH $ADP $FB $FEYE $PANW $SINO $TOPS $ZNGA
Diego R
21 Oct 14 14:49:17
RT @ACInvestorBlog: Stocks to Watch for October 22, 2014 http://t.co/v3kUNdHokH $ADP $FB $FEYE $PANW $SINO $TOPS $ZNGA
FonsieTrader
21 Oct 14 14:40:47
"@ACInvestorBlog: Stocks to Watch for October 22, 2014 http://t.co/lwE0Hon7WI $ADP $FB $FEYE $PANW $SINO $TOPS $ZNGA" Great Job! Like it
Antonio Costa
21 Oct 14 14:37:48
Stocks to Watch for October 22, 2014 http://t.co/v3kUNdHokH $ADP $FB $FEYE $PANW $SINO $TOPS $ZNGA
Corey Hawk
21 Oct 14 14:20:56
got $FEYE #FireEye instead? Palo Alto Networks boxes spray firewall creds across the net • The Register - http://t.co/hLwbQkTH8y
Marc Hav FX
21 Oct 14 14:15:12
$FEYE FIREEYE INC. (UPDATED 21OCT2014) http://t.co/ENAuZ4yE9j
Marc Hav
21 Oct 14 14:15:11
$FEYE FIREEYE INC. (UPDATED 21OCT2014) http://t.co/t5gimduRyP
option
21 Oct 14 13:22:34
RT @Taarriqq: $FEYE getting a bounce on calls block buy, details @optionsstats
Daniele Ceccarelli
21 Oct 14 13:09:44
$FEYE finally closed above $30
apppro
21 Oct 14 13:03:30
$feye quasi pop today from that option buy OR from the Apple hack and that the fact feye has $aap compatible hacking defense programming.
Pacifico619
21 Oct 14 12:57:05
@ToPNoTCH_954 Hell yeah bud im close but this much pain is nothing.Already made more buying the dip with other stock. 35 $FEYE lets go
DMIcode
21 Oct 14 12:25:42
@keithmccullough $BABA $FEYE
John Ross
21 Oct 14 12:16:01
$FEYE Hey now, HEY now ... I'm in in-da-money
Pacifico619
21 Oct 14 12:02:20
a close above 30 $FEYE starts a nice bullish trend. shorts losing their grip.
Large Void Bot
21 Oct 14 12:00:47
Popular: $UGAZ, $BITA, $BABA, $AMGN, $CGIX, $UBS, $FEYE, $VMW, $DATA, $LB, $RAI, $IRBT, $TZA, $CREE
Julien Reny
21 Oct 14 11:59:06
Good morning $FEYE
OPTIONS/STOCK EXPERT
21 Oct 14 11:54:37
$FEYE getting a bounce on calls block buy, details @optionsstats
US_proptrader
21 Oct 14 11:51:31
$BTU $FEYE $MHR $NLNK $VSR $XCO autocharts @ http://t.co/hj7PGeTQk3
Tracy N
21 Oct 14 11:47:34
@KeithMcCullough asking for a friend $FEYE
DailyStockPicks
21 Oct 14 11:43:22
Earnings out for Owens Corning tomorrow. Is it due for a collapse? http://t.co/Est9NjxYUb $TRN $YHOO $YELP $UTRM $GUR $FEYE $ISRG $ISIS
Joe Blume
21 Oct 14 11:43:04
RT @sd61923: $FEYE stuck hear come on lets see 30, all other cyber security stocks moving.
Joe Blume
21 Oct 14 11:42:59
RT @etarlas22: $FEYE getting legs #bullish
DMIcode
21 Oct 14 11:42:55
@keithmccullough $QQQ $BABA $FEYE thx!
Jon Vince
21 Oct 14 11:39:37
"@bobcatfyi: some volume in $FEYE" - Sentiment has changed... Stubborn shorts, who didn't get memo, now leaving.
DMIcode
21 Oct 14 11:37:34
@optionsizzle $FEYE they report on 11/4 after close.
Stockcat
21 Oct 14 11:35:36
some volume in $FEYE
Eternity101
21 Oct 14 11:35:24
RT @ACInvestorBlog: $FEYE FireEye Nov 7 $30 Call; 3,638 Contracts
Tdbryan1987
21 Oct 14 11:33:33
RT @ACInvestorBlog: $FEYE FireEye Nov 7 $30 Call; 3,638 Contracts
St. Louis Blues 2015
21 Oct 14 11:32:59
$FEYE getting legs #bullish
Antonio Costa
21 Oct 14 11:32:44
$FEYE FireEye Nov 7 $30 Call; 3,638 Contracts
$
21 Oct 14 11:32:24
@MookTrader para up $FEYE
Zubeyr Kamil Açıksar
21 Oct 14 11:31:30
RT @optionsizzle: $FEYE 11/7 Nov $30 calls bought here at 2.05. The $33 strike tied to 88k shares of stock
FonsieTrader
21 Oct 14 11:31:15
$FEYE Option Alert: FireEye Nov 7 $30 Call; 3,638 Contracts Traded vs 614 OI; Currently $29.88
Kansas City Traders
21 Oct 14 11:27:59
@WallStJesus interesting flow into $FEYE in NOV 7
Sean Moran
21 Oct 14 11:27:50
RT @fobmanny: Post Alibaba, '14 IPO Rocket Ride Losing Thrust http://t.co/8fTDUOK9Dz $BABA $FEYE $GPRO $MBLY $ZAYO $HTGC $FUEL $VSLR $SCTY …
Andy Lewis
21 Oct 14 11:27:17
$FEYE waking up
SH
21 Oct 14 11:25:12
$FEYE Careful here, option buyers have been wrong already and IV is high
SH
21 Oct 14 11:24:44
$FEYE Opening sweep > 2065 FEYE Fri 11/7 30.0 Calls (Wkly) $2.048 ASK
FOBManny
21 Oct 14 11:18:41
Post Alibaba, '14 IPO Rocket Ride Losing Thrust http://t.co/8fTDUOK9Dz $BABA $FEYE $GPRO $MBLY $ZAYO $HTGC $FUEL $VSLR $SCTY $MOLG $XENE $DM
Ben Silverberg
21 Oct 14 11:14:02
Yet another breach of payment card data this time at $SPLS; data security stocks $FEYE $PFPT $IMPV $CUDA should be on your radar screen.
Philippe P
21 Oct 14 11:12:33
Great #Greenday for #stocks don't forget #earnings for $YHOO today @Yahoo ! $IFON $GLUU $MEET $FEYE $MATR $LOCO
Pacifico619
21 Oct 14 10:52:09
$FEYE stuck hear come on lets see 30, all other cyber security stocks moving.
stockdiva 02
21 Oct 14 05:59:45
Pre market movers and shakers....... $DRYS $SWKS $FEYE $ILMN $OTIV $SGYP $NLNK $JRJC $NEON $LIVE
Antonio Costa
21 Oct 14 05:50:47
Pre-market movers $ILMN $OTIV $SGYP $DRYS $NLNK $JRJC $SWKS $ENPH $NEON $LIVE $FEYE
fazo
21 Oct 14 05:15:59
#CORE5 going to the next level today -- we got the pullback -- now the jump up -- $FB $TWTR $CELG $INVN $HAIN #NEXT5 $MBLY $OAS $FEYE $ACT
12Stocks.com
21 Oct 14 03:03:32
Weekly MidCap #Stocks Trend $SHLD $TMHC $NSM $ARIA $OCN $LII $LEN $DPZ $DHI $PHM $FEYE $THRX $INCY $ADS $ALK @ http://t.co/tf79gD96D3
Stockaholics
21 Oct 14 00:39:29
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $RHI $KMX $FEYE
WolfOfBocaRaton
20 Oct 14 22:57:14
$PANW $FEYE Possible data breach at Staples http://t.co/9Wkqexk7dz
				
				
By  +Follow September 19, 2013 2:12PM
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