FORTINET INC (FTNT)
US34959E1091 - Common Stock
FTNT gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 276 industry peers in the Software industry. While FTNT belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. FTNT is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! These ratings could make FTNT a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
In the past year FTNT was profitable.
FTNT had a positive operating cash flow in the past year.
FTNT had positive earnings in each of the past 5 years.
Each year in the past 5 years FTNT had a positive operating cash flow.
1.2 Ratios
FTNT has a better Return On Assets (15.81%) than 95.26% of its industry peers.
FTNT's Return On Invested Capital of 27.59% is amongst the best of the industry. FTNT outperforms 98.18% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for FTNT is significantly above the industry average of 10.10%.
The 3 year average ROIC (21.99%) for FTNT is below the current ROIC(27.59%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.81% | ||
| ROE | N/A | ||
| ROIC | 27.6% |
ROA(3y)13.28%
ROA(5y)12.09%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)21.99%
ROIC(5y)18.99%
1.3 Margins
FTNT has a better Profit Margin (21.64%) than 91.24% of its industry peers.
In the last couple of years the Profit Margin of FTNT has grown nicely.
FTNT has a Operating Margin of 23.31%. This is amongst the best in the industry. FTNT outperforms 93.80% of its industry peers.
FTNT's Operating Margin has improved in the last couple of years.
FTNT has a Gross Margin of 76.68%. This is in the better half of the industry: FTNT outperforms 73.36% of its industry peers.
FTNT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.31% | ||
| PM (TTM) | 21.64% | ||
| GM | 76.68% |
OM growth 3Y7.15%
OM growth 5Y12.69%
PM growth 3Y4.74%
PM growth 5Y3.25%
GM growth 3Y-0.58%
GM growth 5Y0.44%
2. Health
2.1 Basic Checks
FTNT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
FTNT has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, FTNT has less shares outstanding
Compared to 1 year ago, FTNT has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.85 indicates that FTNT is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 4.85, FTNT is doing good in the industry, outperforming 70.44% of the companies in the same industry.
The Debt to FCF ratio of FTNT is 0.57, which is an excellent value as it means it would take FTNT, only 0.57 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 0.57, FTNT is doing good in the industry, outperforming 79.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 0.57 | ||
| Altman-Z | 4.85 |
ROIC/WACC2.75
WACC10.02%
2.3 Liquidity
FTNT has a Current Ratio of 1.19. This is a normal value and indicates that FTNT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.19, FTNT is doing worse than 68.25% of the companies in the same industry.
A Quick Ratio of 1.06 indicates that FTNT should not have too much problems paying its short term obligations.
FTNT has a Quick ratio of 1.06. This is in the lower half of the industry: FTNT underperforms 73.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.19 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 36.89% over the past year.
FTNT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 35.13% yearly.
Looking at the last year, FTNT shows a very strong growth in Revenue. The Revenue has grown by 20.09%.
FTNT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.11% yearly.
EPS 1Y (TTM)36.89%
EPS 3Y34.64%
EPS 5Y35.13%
EPS growth Q2Q15.91%
Revenue 1Y (TTM)20.09%
Revenue growth 3Y26.92%
Revenue growth 5Y24.11%
Revenue growth Q2Q10.3%
3.2 Future
Based on estimates for the next years, FTNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.59% on average per year.
FTNT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.91% yearly.
EPS Next Y6.48%
EPS Next 2Y9.99%
EPS Next 3Y15.38%
EPS Next 5Y13.59%
Revenue Next Year9.08%
Revenue Next 2Y11.27%
Revenue Next 3Y12.54%
Revenue Next 5Y16.91%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 39.13 indicates a quite expensive valuation of FTNT.
Based on the Price/Earnings ratio, FTNT is valued a bit cheaper than 68.61% of the companies in the same industry.
FTNT's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 24.92.
With a Price/Forward Earnings ratio of 36.75, FTNT can be considered very expensive at the moment.
FTNT's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. FTNT is cheaper than 64.60% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.49, FTNT is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.13 | ||
| Fwd PE | 36.75 |
4.2 Price Multiples
77.01% of the companies in the same industry are more expensive than FTNT, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, FTNT is valued a bit cheaper than the industry average as 78.10% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.28 | ||
| EV/EBITDA | 34.35 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates FTNT does not grow enough to justify the current Price/Earnings ratio.
FTNT has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as FTNT's earnings are expected to grow with 15.38% in the coming years.
PEG (NY)6.04
PEG (5Y)1.11
EPS Next 2Y9.99%
EPS Next 3Y15.38%
5. Dividend
5.1 Amount
FTNT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
FORTINET INC
NASDAQ:FTNT (4/26/2024, 7:00:00 PM)
After market: 64.15 -0.03 (-0.05%)64.18
+0.15 (+0.23%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap48.97B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 39.13 | ||
| Fwd PE | 36.75 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)6.04
PEG (5Y)1.11
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.81% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 23.31% | ||
| PM (TTM) | 21.64% | ||
| GM | 76.68% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.73
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.19 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)36.89%
EPS 3Y34.64%
EPS 5Y
EPS growth Q2Q
EPS Next Y6.48%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)20.09%
Revenue growth 3Y26.92%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y