FireEye Target Cut At Credit Suisse, 45% Upside Still Predicted

• FireEye Inc FEYE shares have plummeted 70.51 percent over the past six months, trading almost at their 52 week low on February 8, at $11.96
• Barclays’ Saket Kalia has maintained an Equal-weight rating on the company, while lowering the price target from $21 to $18.
• The company announced its quarterly results mostly in line with the pre-announcement, while the FY16 guidance was in line with the previous estimates.

Analyst Saket Kalia believes that with the quarterly results mostly in line with the January 20 pre-announcement, investors were likely to focus on the FY16 guidance.

While the FY16 guidance was more or less in line with the previous estimates, the contribution from acquisitions was higher than expected.

“FY16 billings guidance of $975-$1,055M compares to our previous $999M, which both assume 20 percent organic growth,” Kalia said.

The recent acquisitions of iSight and Invotas are expected to contribute billings worth $60-$65 million, although excluding the large deals in 1H15, apples-to-apples billings growth would be about 25 percent.

Kalia noted that “management plans on keeping operating expenses roughly flat from 1Q to 4Q, as they leverage investments and direct spending to higher growth areas like FaaS, which grew 100 percent in FY15,” while adding that new products in FY16 “will segment the market to better compete.”