NEW YORK (TheStreet) -- Shares of FireEye (FEYE) - Get FireEye, Inc. Report are getting a lift, higher by 2.65% to $30.57 in midday trading on Wednesday, after analysts at Bank of America/Merrill Lynch named the company a "top security pick" for 2015.
The firm believes FireEye shares are poised to recover in 2015 driven by reduced expectations, robust security spending trends, new product launches that should begin to contribute, and above industry organic revenue and billings growth.
BofA/Merrill analysts expect cash burn to slow in 2015 and 2016, turning into positive free cash flow in 2017.
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The firm currently has a "buy" rating with a $44 price target on shares.
Milpitas, CA-based FireEye created 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.
Separately, TheStreet Ratings team rates FIREEYE INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate FIREEYE INC (FEYE) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share and deteriorating net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- FIREEYE INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. For the next year, the market is expecting a contraction of 362.2% in earnings (-$2.08 versus -$0.45).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Software industry. The net income has significantly decreased by 135.7% when compared to the same quarter one year ago, falling from -$50.93 million to -$120.03 million.
- Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 27.59%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 93.02% compared to the year-earlier quarter.
- Compared to other companies in the Software industry and the overall market, FIREEYE INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for FIREEYE INC is currently very high, coming in at 82.47%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -105.09% is in-line with the industry average.
- You can view the full analysis from the report here: FEYE Ratings Report