FORTINET INC (1FTNT.MI) Stock Fundamental Analysis

Europe - Euronext Milan - BIT:1FTNT - US34959E1091 - Common Stock

69.22 EUR

+6.11 (+9.68%)

Last: 1/26/2026, 7:00:00 PM

Fundamental Rating

We assign a fundamental rating of 7 out of 10 to 1FTNT. 1FTNT was compared to 114 industry peers in the Software industry. 1FTNT scores excellent points on both the profitability and health parts. This is a solid base for a good stock. 1FTNT is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings could make 1FTNT a good candidate for growth and quality investing.

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1. Profitability

1.1 Basic Checks

In the past year 1FTNT was profitable.
In the past year 1FTNT had a positive cash flow from operations.
Each year in the past 5 years 1FTNT has been profitable.
In the past 5 years 1FTNT always reported a positive cash flow from operatings.

1.2 Ratios

1FTNT has a Return On Assets of 20.01%. This is amongst the best in the industry. 1FTNT outperforms 91.23% of its industry peers.
The Return On Equity of 1FTNT (254.88%) is better than 100.00% of its industry peers.
1FTNT has a Return On Invested Capital of 38.77%. This is amongst the best in the industry. 1FTNT outperforms 98.25% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1FTNT is significantly above the industry average of 13.49%.
The last Return On Invested Capital (38.77%) for 1FTNT is above the 3 year average (28.58%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	20.01%
ROE	254.88%
ROIC	38.77%

ROA(3y)15.82%

ROA(5y)13.96%

ROE(3y)N/A

ROE(5y)N/A

ROIC(3y)28.58%

ROIC(5y)24.19%

1.3 Margins

The Profit Margin of 1FTNT (28.58%) is better than 89.47% of its industry peers.
In the last couple of years the Profit Margin of 1FTNT has grown nicely.
1FTNT has a better Operating Margin (30.86%) than 88.60% of its industry peers.
In the last couple of years the Operating Margin of 1FTNT has grown nicely.
With a decent Gross Margin value of 80.86%, 1FTNT is doing good in the industry, outperforming 71.05% of the companies in the same industry.
1FTNT's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	30.86%
PM (TTM)	28.58%
GM	80.86%

OM growth 3Y16.85%

OM growth 5Y13.69%

PM growth 3Y17.3%

PM growth 5Y13.83%

GM growth 3Y1.97%

GM growth 5Y1.17%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

1FTNT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, 1FTNT has about the same amount of shares outstanding.
Compared to 5 years ago, 1FTNT has less shares outstanding
Compared to 1 year ago, 1FTNT has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 5.57 indicates that 1FTNT is not in any danger for bankruptcy at the moment.
1FTNT's Altman-Z score of 5.57 is fine compared to the rest of the industry. 1FTNT outperforms 73.68% of its industry peers.
1FTNT has a debt to FCF ratio of 0.49. This is a very positive value and a sign of high solvency as it would only need 0.49 years to pay back of all of its debts.
1FTNT has a better Debt to FCF ratio (0.49) than 86.84% of its industry peers.
1FTNT has a Debt/Equity ratio of 0.68. This is a neutral value indicating 1FTNT is somewhat dependend on debt financing.
1FTNT has a Debt to Equity ratio of 0.68. This is in the lower half of the industry: 1FTNT underperforms 71.93% of its industry peers.
Although 1FTNT does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.68
Debt/FCF	0.49
Altman-Z	5.57

ROIC/WACC3.49

WACC11.1%

2.3 Liquidity

A Current Ratio of 1.03 indicates that 1FTNT should not have too much problems paying its short term obligations.
With a Current ratio value of 1.03, 1FTNT is not doing good in the industry: 67.54% of the companies in the same industry are doing better.
1FTNT has a Quick Ratio of 1.03. This is a bad value and indicates that 1FTNT is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of 1FTNT (0.94) is worse than 74.56% of its industry peers.
1FTNT does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.03
Quick Ratio	0.94

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 26.17% over the past year.
The Earnings Per Share has been growing by 36.84% on average over the past years. This is a very strong growth
Looking at the last year, 1FTNT shows a quite strong growth in Revenue. The Revenue has grown by 14.78% in the last year.
The Revenue has been growing by 22.46% on average over the past years. This is a very strong growth!

EPS 1Y (TTM)26.17%

EPS 3Y43.86%

EPS 5Y36.84%

EPS Q2Q%17.46%

Revenue 1Y (TTM)14.78%

Revenue growth 3Y21.24%

Revenue growth 5Y22.46%

Sales Q2Q%14.38%

3.2 Future

Based on estimates for the next years, 1FTNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.01% on average per year.
1FTNT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.42% yearly.

EPS Next Y15.71%

EPS Next 2Y12.28%

EPS Next 3Y11.85%

EPS Next 5Y9.01%

Revenue Next Year14.66%

Revenue Next 2Y12.91%

Revenue Next 3Y12.15%

Revenue Next 5Y12.42%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.

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4. Valuation

4.1 Price/Earnings Ratio

1FTNT is valuated quite expensively with a Price/Earnings ratio of 30.63.
Based on the Price/Earnings ratio, 1FTNT is valued a bit cheaper than the industry average as 61.40% of the companies are valued more expensively.
1FTNT's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.39.
1FTNT is valuated quite expensively with a Price/Forward Earnings ratio of 27.72.
The rest of the industry has a similar Price/Forward Earnings ratio as 1FTNT.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.72, 1FTNT is valued at the same level.

		Industry Rank	Sector Rank
PE	30.63
Fwd PE	27.72

4.2 Price Multiples

1FTNT's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, 1FTNT is valued a bit cheaper than the industry average as 63.16% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	30.37
EV/EBITDA	26.89

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1FTNT does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of 1FTNT may justify a higher PE ratio.