This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

FireEye Lock-Up Expiration Not Twitter Round Two: StockTwits.com

NEW YORK (TheStreet) -- Twitter  (TWTR - Get Report) round two? That was a question for FireEye  (FEYE - Get Report) investors Tuesday ahead of the expiration of sales restrictions on millions of insider shares. And on StockTwits.com a majority said "no."

About 68% of FireEye's outstanding shares will become available for trading Wednesday. Investors in the security company have long braced for a scenario in which insiders, frustrated with FireEye's near 70% decline from March all-time-highs, will shed shares.

$FEYE Almost 74 mil shares eligible tomorrow are from the initial IPO from Sep 2013, initially priced at $13. Investor base were probably $5 ? Mike (@scottsdalem) May. 20 at 05:30 PM

$FEYE For employee allocated stocks, it were given to them at less than $1 /share. ? Mike (@scottsdalem) May. 20 at 05:31 PM

$FEYE So either investor or employee, would like to lock profit at $30 before it tanks below $14, its intrinsic value. I rest my case. ? Mike (@scottsdalem) May. 20 at 05:33 PM

However, on Tuesday, many investors bet that the stock would go up as new investors, encouraged by a lack of insider selling, bought in and short sellers covered rather than risk more losses. Short interest in the stock is 10.31% of float, according to shortsqueeze.com.

$FEYE Today was a test by the MM they are going to squeeeeze the life out of the short sellers tomorrow....mark my words. ? brad smit (@Bsmit) May. 20 at 04:56 PM

Sentiment on FireEye remained majority bullish Tuesday with 55% of the StockTwits' crowd calling for gains, according to site analytics. Bullish sentiment actually increased nearly 6% Tuesday ahead of the lock-up expiry.

$FEYE 70% of the float will be unlocked tomorrow...Seem like lots of heroes are here holding it up. Very brave. ? Lyndon Joseph (@ardeljoseph) May. 20 at 04:00 PM

One reason for the confidence in FireEye insiders holding shares was a bullish note from Nomura. Analyst Rick Sherlund said that FireEye is a best-in-breed security company that will pay off for investors with a longer time horizon who are willing to deal with the ups and downs of the stock as the company invests in its business. Sherlund maintained a buy rating on the stock and $55 target. FireEye shares rose nearly 5% today and closed up yesterday. However, they declined 0.73% in after-hours trading.

$FEYE here comes the stampede out the exit ? Jason Yi (@Jason100) May. 20 at 03:40 PM

Some investors on StockTwits pointed out that Twitter shares also rose leading up to expiry before tanking 18% after lock-up expired.

$FEYE gap fill technical setup is the perfect bull trap before lockup crashes this one 10% or more... ? bnm (@bnm123z) May. 20 at 02:40 PM

And investors doubted Nomura's objectivity. Some said that the Nomura analyst might be drinking the FireEye Kool-Aid given that his firm was one of the underwriters of FireEye's IPO offering and would have had many people exposed to the marketing spiel.

$FEYE Nomura: hey guys, we're the underwriters, so we should probably make a last ditch effort to upgrade this so we get more bagholders ? Brian (@ballsohardstreet) May. 20 at 05:37 PM

But others argued that the impact of the lock-up expiration was already priced into FireEye shares. The stock now has a $4 billion market cap -- a far cry from the $13 billion it once boasted.

$FEYE -- at one point this thing had a market cap of $13 billion on quarterly revenue of $73 million. My goodness. ? stefan cheplick (@scheplick) May. 20 at 03:45 PM

FireEye expects to bring in between $405 million and $415 million in revenue this year with gross margins in the range of 70% to 73%, according to its latest quarterly report.

@scottsdalem understand the TWTR was at all time high as was FB when the lock-up occured. FEYE has already been sold off. Big difference ? Megaas2000 (@Megaas2000) May. 20 at 05:18 PM

At the time of publication the author held no positions in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
FEYE $46.35 -1.00%
TWTR $36.63 -0.54%
FB $78.95 -1.50%
GOOG $531.87 -1.50%
TSLA $249.73 -0.68%

Markets

DOW 17,997.13 -128.99 -0.71%
S&P 500 2,108.75 -12.04 -0.57%
NASDAQ 5,073.6230 -24.3530 -0.48%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs