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Cybersecurity firm FireEye spikes after reportedly hiring Goldman Sachs for a potential sale (FEYE)

FireEye 2016 Black Hat expo

  • Cybersecurity firm FireEye skyrocketed as much as 11% after sources told Business Insider it hired Goldman Sachs to advise the company on a potential sale.
  • The jump came amid broad losses across major US indexes, which fell roughly 2% on negative economic data and reignited recession fears.
  • The company is eyeing private-equity firms as the most likely buyers, the sources said.
  • FireEye is still down more than 30% since its 2013 initial public offering.
  • Watch FireEye trade live here.

Cybersecurity company FireEye soared as much as 11% after sources told Business Insider the firm is tapping Goldman Sachs for a potential sale.

Goldman has been approached to advise FireEye in a possible deal, two sources told reporters Bradley Saacks and Casey Sullivan. The company is eyeing private-equity firms as the most likely buyers, but talks are in early stages and there is no certainty a sale will take place, the sources added.

The Silicon Valley firm has struggled since its 2013 initial public offering, and is still down roughly 30% since the offering despite Wednesday's gains.

FireEye traded at $13.96 per share as of 2:30 p.m. ET Wednesday, down more than 80% from its peak of $95.63, reached in March 2014.

Read more: Silicon Valley cybersecurity company FireEye has hired Goldman Sachs for a potential sale, sources tell Business Insider

CEO Kevin Mandia led FireEye through a transition from hardbox sales to software-as-a-service, helping the firm bring in positive net income in the fourth quarter of 2017. The good tidings didn't last long though, as increased competition in the SaaS sector and rising expenses eliminated profitability.

The gain comes amid mass selloff for US equities, with major stock indexes dropping roughly 2% on disappointing manufacturing and hiring data. The economic reports reignited fears of a looming recession for the US economy. The S&P 500 Information Technology sector is down roughly 2.3%.

FireEye has 12 "buy" ratings, 12 "hold" ratings, and one "sell" rating from analysts, with a consensus price target of $17.39, according to Bloomberg data.

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FEYE

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