FireEye, Inc. (FEYE) Hacking Report Entices Option Bulls

A report by FireEye Inc (FEYE) accuses China of a 10-year hacking campaign in Asia


Published on Apr 13, 2015 at 10:44 AM
Updated on Apr 20, 2015 at 5:32 PM

FireEye Inc (NASDAQ:FEYE) made waves over the weekend, releasing a report documenting a decade's worth of cyber espionage by a group linked to the Chinese government. Meanwhile, in today's options pits, calls are crossing at double the usual intraday clip, outstripping puts by a nearly 7-to-1 margin.

Among the most active FEYE strikes is the April 43 call, where it looks like traders are buying new positions. In so doing, these speculators anticipate the stock -- which is down 2% at $42.38, along with sector peer Symantec Corporation (NASDAQ:SYMC) -- will rebound back above $43 by this Friday's close, when front-month options expire.

Longer term, FEYE has put on a clinic on the charts. Year-to-date, the equity has advanced roughly 34%, while outperforming the broader S&P 500 Index (SPX) by 21 percentage points over the last three months.

Should this technical trend continue, FireEye Inc (NASDAQ:FEYE) could benefit from a round of positive analyst attention. Nearly half of the analysts tracking the outperformer have given it a "hold" or worse recommendation, and the stock's average 12-month price target of $43.35 sits at a slim 2.3% premium to current trading levels.

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