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FireEye Inc FEYE

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It’s Not You, It’s Me; FireEye Selling FireEye Products Division to Focus on SaaS and Services

Mark Cash Senior Equity Analyst

Analyst Note

| Mark Cash |

We are maintaining our $17 fair value estimate for no-moat FireEye after it announced the sale of the FireEye products business to Symphony Technology Group for $1.2 billion in an all-cash transaction. This is a shrewd deal in our opinion as FireEye’s leading consulting and professional services division were at times overlooked due to its security products not being best-of-breed against sizable competitors with entrenched customer bases. With the pandemic changing the dynamics of the attack surface and a ramped up threat environment, alongside the persistent talent dearth in cybersecurity, the sale is well timed, in our view. We believe that under its new name, Mandiant’s focus on supplementing security teams and automating threat response is the proper strategic decision. Nonetheless, we remain hesitant about Mandiant carving out sustainable customer switching costs. Shares fell over 5% on the news, but we still view shares as overvalued and expect more insight when FireEye reports their second-quarter earnings.

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Company Profile

Business Description

FireEye is a pure-play cybersecurity firm that offers solutions for networks, endpoints, and email. FireEye's products for on-premises and cloud-based security are supplemented by its services division, with its Mandiant consulting group as a main player in the market for breach responses and security assessments. The company's security experts can be used on demand by customers and help FireEye innovative its product offerings. The California-based company sells products worldwide; it was founded in 2004 and went public in 2013.

601 McCarthy Boulevard
Milpitas, CA, 95035
T +1 408 321-6300
Sector Technology
Industry Software - Infrastructure
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2021
Stock Type Classic Growth
Employees 3,400

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