Analyst Downgrades: FireEye Inc, Five Below Inc, and Finisar Corporation

Analysts downwardly revised their ratings on FEYE, FIVE, and FNSR

by Alex Eppstein

Published on Dec 5, 2014 at 9:30 AM
Updated on Apr 20, 2015 at 5:32 PM

Analysts are weighing in today on cyber security firm FireEye Inc (NASDAQ:FEYE), discount retailer Five Below Inc (NASDAQ:FIVE), and optical components specialist Finisar Corporation (NASDAQ:FNSR). Here's a quick roundup of today's bearish brokerage notes on FEYE, FIVE, and FNSR.

  • JMP Securities initiated coverage on FEYE with a "market perform" rating. Technically speaking, the stock has been a dud in 2014, shedding 30.4% of its value to rest at $30.37. Nevertheless, the majority of covering analysts are bullish on FireEye Inc, with nearly two-thirds doling out a "strong buy" recommendation. Plus, the stock's consensus 12-month price target of $37.95 stands 25% above the current price. All things considered, FEYE may be vulnerable to another round of negative analyst notes, potentially exacerbating selling pressure.

  • FIVE is staring at a drop of 11% out of the gate, after the firm issued a disappointing sales outlook and announced its next CEO during last night's trip to the earnings confessional. Also pressuring the shares in electronic trading is a trio of price-target cuts at Buckingham (to $40 from $41), Sterne Agee (to $45 from $46), and Deutsche Bank (to $46 from $49) -- with the first underscoring its "neutral" rating, and the other two reaffirming their "buy" opinions. Taking a step back, Five Below Inc has had a disappointing 2014, closing last night 0.8% below its year-to-date flatline. As such, options traders have been upping the bearish ante in recent weeks. FIVE's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 1.34 sits just 11 percentage points from a 12-month peak. Elsewhere, 24.2% of the stock's float is sold short, which represents four weeks' worth of pent-up buying power, at FIVE's average daily pace of trading.

  • Finally, FNSR is down 2% ahead of the bell, after last night's disappointing turn in the earnings confessional prompted a round of negative analyst attention. Specifically, no fewer than six brokerage firms reduced their price targets -- and Jefferies offered the most bearish forecast, trimming its target to $18.50 from $18.75, while reiterating its "hold" opinion. On the charts, Finisar Corporation has staggered to a nearly 29% year-to-date loss to trade at $17.00. However, eight out of 13 covering analysts still maintain "buy" or better recommendations on the shares, and the security's consensus 12-month price target of $21.29 is more than 25% above the current share price. If FNSR continues to struggle, it could pave the way for another flurry of bearish brokerage notes.

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