Cybersecurity company FireEye’s (FEYE) underwhelming second-quarter financial performance has caused its share price to tumble. Furthermore, its recent deal to sell its FireEye (NASDAQ:FEYE) Products business has raised investors’ concerns about the stock’s prospects. So, given the company’s business-model switch and bleak financials, can the stock rebound in the near term? Let’s discuss.FireEye, Inc. (FEYE) is a Milpitas, Calif.-based cybersecurity solutions provider. The company generated robust revenue growth last year in its Mandiant Solutions business as organizations turned to cybersecurity solutions amid rising cyber threats. But the stock’s price has dipped 16.3% over the past month and 22.5% year-to-date owing to FEYE’s unimpressive second-quarter 2021 earnings report. Also, the stock is currently trading 30% below its 52-week high of $25.53, indicating short-term bearishness.
FEYE’s recent announcement of its sale of its FireEye Products business to a private equity company has further added to investors’ anxiety surrounding the stock.
Because the company plans now to focus solely on its cloud-first security product portfolio, we think the investor uncertainty surrounding the business-model transition and its growth potential could put further downward pressure on its stock in the near term.