Today: A secondary offering from red-hot Milpitas security software company FireEye and initial public offering from Mountain View's Coupons.com transfer more than $1 billion from Wall Street to Silicon Valley. Also: Job growth looks good in U.S., Bay Area.
The Lead: FireEye, Coupons.com show Wall Street enthusiasm for Silicon Valley
Wall Street's thirst for Silicon Valley technology companies has not died down despite a lull in IPOs during the first two months of this year, with a huge secondary offering from FireEye and an initial public offering from Coupons.com generating gigantic paydays Friday for Silicon Valley.
FireEye raked in about $1.15 billion by selling 14 million shares less than six months after the Milpitas security software company executed an IPO that sold shares at less than a quarter of that cost. Since its IPO, FireEye has seriously beefed up its offering with the $1 billion acquisition of Mandiant while the types of data breaches the company focuses on detecting and preventing have generated waves of headlines, thanks to a holiday-shopping-season incursion at retail giant Target and a campaign to help businesses avoid similar troubles from California Attorney General Kamala Harris.
"We want to create the platform where security professionals of the world can go from alert to fix in minutes," Chief Operating Officer Kevin Mandia, the founder and CEO of Mandiant, said in a Friday phone interview.
FBR Capital Markets analyst Daniel Ives said Friday that FireEye has exhibited "massive hypergrowth" that justifies its skyrocketing stock, which reached as high as $97.35 in intraday trading this week.
"Their detection capabilities are as advanced as any out there in determining and quantifying threats to networks," Ives said, adding that having former McAfee CEO David DeWalt at the helm excites investors.
"DeWalt has the golden touch. Investors who have bet on DeWalt over the last decade are sleeping pretty well at night," he said.
FireEye will receive $457.7 million in proceeds from the offering, while early investors and stakeholders such as CEO DeWalt and Palo Alto venture capital firm Norwest Venture Partners receive $690.3 million. Shares declined to more closely mirror the offering price Friday, falling 9.5 percent to $81.04.
Coupons.com did not fall Friday on Wall Street, doubling an elevated IPO price during its debut session before closing with a gain of 87.5 percent at $30, showing Wall Street's continuing interest in traditional discounting while Groupon flounders.
The Mountain View website charged $16 for IPO shares, higher than the projected $12-$14 range, then moved as high as $33 after debuting on the New York Stock Exchange under the ticker symbol COUP. The warm reception from IPO investors and Wall Street traders follows a similar path to RetailMeNot, an Austin, Texas, website that offers coupon codes for online shopping, which has more than doubled from its IPO price on the public markets. Meanwhile, Groupon languishes at less than half its IPO price.
Coupons.com is the first technology IPO from Silicon Valley in 2014, and only the second this year in the United States, while biotechnology companies rack up big entries on Wall Street. Next week, South San Francisco biotech Achaogen and San Francisco health-care software company Castlight Health are expected to be the next companies to debut.
SV150 market report: Jobs reports hopeful, but Silicon Valley tech stocks decline
Wall Street wavered Friday despite a bounceback for U.S. job growth, and Silicon Valley technology stocks took a tumble even as the Bay Area job picture appeared better than the rest of the nation.
The Commerce Department reported Friday that the United States gained 175,000 jobs in February, a strong gain from weak results in December and January. The national unemployment rate still moved higher, from 6.6 percent to 6.7 percent, but economists said that was a result of more unemployed people resuming their job searches, a hopeful sign for the economy. Meanwhile, California's Economic Development Department released job figures for January, which revised the previous year's numbers to show huge job growth in Silicon Valley, with previous estimates of an addition of 70,000 jobs in 2013 revised up to 117,000. "This is a blowout number for the Bay Area job market," Stephen Levy, director of the Palo Alto-based Center for Continuing Study of the California Economy, told staff writer George Avalos.
FireEye rival Palo Alto Networks roared 11 percent higher to $77.12 Friday after a mistrial was declared in its patent trial with Juniper Networks; Sunnyvale-based Juniper dropped 0.7 percent to $26.26. Facebook dropped 1.5 percent to $69.80 after its Facebook photo-sharing app signed a big advertising deal with Omnicom Media, which reportedly guarantees $100 million in advertising revenues this year. The Menlo Park social network was threatened with a ban by the Turkish prime minister, who also said Google's YouTube offering could be blocked in the nation after the services were used to post audio recordings of the official that suggested corruption; Google dropped 0.4 percent to $1,214.79 as its mysterious barge landed in Stockton. eBay dropped 0.4 percent to $59.06 while board member Marc Andreessen attacked activist investor Carl Icahn's business ethics, after Icahn made a similar attack against the Silicon Valley venture capitalist in his campaign to get eBay to spin off PayPal.
Up: Palo Alto Networks, Advanced Micro Devices, Intuit, Applied Materials, Zynga, Hewlett-Packard, Electronic Arts
Down: Salesforce, Splunk, NetApp, SolarCity, Tesla, Workday, Yahoo, Twitter, SunPower, Oracle, Facebook, SanDisk, Symantec, LinkedIn
The SV150 index of Silicon Valley's largest tech companies: Down 7.78, or 0.49 percent, to 1,570.93
The tech-heavy Nasdaq composite index: Down 15.9, or 0.37 percent, to 4,336.22
The blue chip Dow Jones industrial average: Up 30.83, or 0.19 percent, to 16,452.72
And the widely watched Standard & Poor's 500 index: Up 1.01, or 0.05 percent, to 1,878.04
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/jowens510.