In a conversation with the CNBC correspondent Melissa Lee, Ed Maguire of CLSA and investment expert Brian Kelly discuss their views on stocks of different cyber security companies. Ed Maguire recommends Splunk Inc. (NASDAQ:SPLK), FireEye, Inc. (NASDAQ:FEYE) for its ability to identify threats and fixing them and Palo Alto Networks, Inc. (NASDAQ:PANW) for being a good network security player. For Splunk his target is $80. On the other two companies Maguire recuses himself from taking a call in response to a question by Lee that the FireEye has seen a roller coaster ride coming down to $24 from $90. Maguire cites various human created problems in the space that impact the behavior of these companies.
Takeover Opportunities
In the context of takeover opportunities in the industry, Maguire says that there are several smaller companies in the cyber security space, which are bringing in great innovation to the industry and can build into fine businesses in the future. These would be potential targets for large companies such as Cisco Systems Inc. (NASDAQ:CSCO), International Business Machines Corporation (NASDAQ:IBM) and Check Point Software Technologies Ltd. (NASDAQ:CHKP), which would be very keen to roll up smaller players and benefit from the innovations taking place in those businesses. Many of these small companies that are publicly traded, could be potential targets for takeover below their market cap. Kelly commented on the FireEye Inc. (NASDAQ:FEYE) stock saying, while he loves the cyber security space, he would never put money on FireEye having had a disappointing experience on the stock. But he quickly clarifies that, it is only his personal view because of his experience.
Intel Corporation (NASDAQ:INTC) in cyber security
On whether Intel Corporation (NASDAQ:INTC) would look at some potential targets for acquisition in cyber security, Maguire felt that Intel had an interest in Internet of Things when they bought Mcafee Com Corp (NASDAQ:MCAF). And Internet of Things is all about cyber security as it requires several billions of devices to be integrated and fully secured. Intel therefore will have an eye for targets in the cyber security area.
Donald Chiboucis‘ Columbus Circle Investors, holds 1.87 million shares of Splunk Inc. (NASDAQ:SPLK), worth $133.67 million. Glg Partners, managed by Noam Gottesman has a stake of 1.35 million shares in Splunk.
Andor Capital Management, led by Daniel Benton holds 450,000 shares of FireEye, Inc. (NASDAQ:FEYE).
Disclosure: none
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