Mandiant Books Lower-than-Expected Q4 Loss; Shares Rise

Mandiant, Inc. (NASDAQ: MNDT), an American cybersecurity firm, has reported a lower-than-expected loss in the fourth quarter of 2021. Also, net revenues surpassed analysts’ expectations. 

Per a Bloomberg report, rumors are floating around the market, hinting that the tech giant Microsoft Corp. (MSFT) might acquire Mandiant to curb hacking and protect clients, as well as to cater to cybersecurity threats. Both companies declined to comment. 

Shares of the company rose 3% in the extended trading session on Tuesday after closing 17.9% higher on the day. 

Results in Detail 

Mandiant incurred an adjusted loss of $0.10 per share in Q4, lower than the Street’s loss estimate of $0.13 per share. The company reported a loss of $0.11 per share in the same quarter last year. 

Total revenues generated during the quarter grew 21% year-over-year and stood at $133 million, topping the consensus estimate of $131.47 million. Remarkably, annualized recurring revenue of $279 million grew 23%, while deferred revenue stood at $410 million, up 44%. 

Adjusted operating margin came in at negative 17%, compared with 22% recorded in the prior-year quarter.  

For 2021, Mandiant posted an adjusted loss of $0.51 per share, lower than the loss of $0.57 per share in the prior year. Revenues came in at $483 million, up 21% year-over-year. 

Capital Deployment 

During the fourth quarter, Mandiant repurchased around $200 million of common stock. As of December 31, 2021, the company has the remaining authorization of $200 million of common stock under the stock repurchase program worth $500 million. 

CEO’s Comments 

Encouragingly, the CEO of Mandiant, Kevin Mandia, said, “We achieved a significant milestone in Q4, divesting the FireEye Products business and positioning Mandiant to deliver accelerating growth and extend our leadership position in expertise and intelligence. We are uniquely positioned to address an enormous market need and can concentrate all of our attention on helping organizations close their cyber security gap.” 

Guidance 

For the first quarter of 2022, the company projects revenue in the range of $128 million to $131 million, versus analysts’ expectations of $134.1 million. Adjusted loss per share is forecast between $0.13 and $0.15, compared with the consensus loss estimate of $0.10 per share. 

For Fiscal 2022, the company expects revenue of $555 million to $565 million, versus the consensus estimate of $574 million. Additionally, adjusted loss per share is estimated to range between $0.36 and $0.38, compared with the Street estimated loss of $0.32 per share. 

Other Developments 

In the current era of increasing cyberattacks, Mandiant and autonomous cybersecurity platform company SentinelOne (NYSE: S) joined hands to minimize the risk of data breaches and cyber threats. 

SentinelOne’s Singularity XDR platform will complement the Mandiant Advantage XDR platform to discover and remediate threats speedily and accurately. 

Wall Street’s Take  

The rest of the Street is bearish on the stock, with a Moderate Sell consensus rating. That’s based on 1 Hold and 1 Sell. The average Mandiant price target of $16.50 implies 7.04% downside potential to current levels. Shares have fallen 22.8% over the past year. 

Investors 

TipRanks’ Stock Investors tool shows that investors currently have a Very Negative stance on Mandiant, with 8.8% of investors maintaining portfolios on TipRanks decreasing their exposure to MNDT stock over the past 30 days. 

It seems that investors were already cautious before media reports related to the expected buyout went public.

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