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How Merrill Lynch and Goldman Sachs Differ on FireEye Stock

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Improved rating and price target of FireEye Stock

In the previous part of this series, we discussed the factors that led Goldman Sachs (GS) to upgrade its rating and price target on FireEye (FEYE) stock.

Merrill Lynch followed the same course and upgraded FireEye stock from “neutral” to “buy.” It also raised its price target to $18.00 from the previous $13.50 per share.

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Factors that instilled optimism in FireEye

Let’s look into the factors that propelled Merrill Lynch to upgrade FireEye. The report noted that a significant market opportunity was highlighted as the first driver. The research firm noted, “There are 6000 appliances that are due a refresh, representing $200 million of market opportunity.”

Other factors that contributed to the company’s upgrade included Cloud MVX and Smart Grid, which were launched in late 2016. Additional factors included the recently launched Helix, improvements to FaaS (FireEye-as-a-Service), and next-generation endpoints.

MVX Smart Grid is a private cloud offering that employs MVX Engine and Smart Nodes to examine Internet traffic to detect and terminate external threats.

According to FireEye, “Cloud MVX provides a FireEye public cloud deployment of the MVX engine, allowing organizations to shift threat detection to the cloud, making the most intelligent security available anywhere, at any time, on a subscription basis.”

In its analysis, Merrill Lynch noted, “Third, improvements to its go-to-market, recently adding new sales leadership, removing sales capacity constraints, and substantially reducing the channel partner conflict.”

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