FireEye (FEYE) to Post Q2 Earnings: What's in the Offing?

FireEye FEYE is set to report second-quarter 2020 results on Jul 28.

For the quarter, FireEye anticipates revenues between $213 million and $217 million. The Zacks Consensus Estimate for revenues currently stands at $214.6 million, implying a 1.37% decline from the year-ago quarter’s reported figure.

The company also projects non-GAAP loss between 3 cents and 1 cent per share. The midpoint of 2 cents matches the consensus mark, suggesting a 100% year-over-year decline.

Notably, the company’s earnings beat the Zacks Consensus Estimate thrice in the trailing four quarters and missed once, the average surprise being 6.25%.

Let’s see how things are shaping up for the upcoming announcement.

FireEye, Inc. Price and EPS Surprise

FireEye, Inc. Price and EPS Surprise

FireEye, Inc. price-eps-surprise | FireEye, Inc. Quote

Factors at Play

FireEye’s second-quarter performance is expected to have benefited from continued solid demand for its products, given the healthy environment of the global security market.

Moreover, strong traction in Mandiant Professional Services revenues is expected to have aided the second-quarter performance. Notably, Mandiant Services engagements, powered by the Verodin platform, have been gaining strong adoption.

Further, continued momentum in Helix, Intel, and cloud e-mail and endpoint is expected to have been a tailwind.

However, supply-chain disruptions due to the coronavirus-induced lockdown globally might have hurt the second-quarter performance.

Restructuring costs of $10-$15 million due to accelerated business transformation are expected to have remained an overhang on the margins in the quarter.

What Our Model Says

The proven Zacks model does not conclusively predict an earnings beat for FireEye this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

FireEye has a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks to Consider

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat this season:

Synaptics SYNA has an Earnings ESP of +10.60% and a Zacks Rank of 1, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Facebook FB has an Earnings ESP of +5.28% and a Zacks Rank of 3.

Alphabet GOOGL has an Earnings ESP of +0.32% and a Zacks Rank of 3.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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