FORTINET INC (FTNT) Stock Fundamental Analysis
USA - NASDAQ:FTNT - US34959E1091 - Common Stock
82.31 USD
+1.28 (+1.58%)
82.31 USD
0 (0%)
We assign a fundamental rating of 7 out of 10 to FTNT. FTNT was compared to 281 industry peers in the Software industry. Both the health and profitability get an excellent rating, making FTNT a very profitable company, without any liquidiy or solvency issues. FTNT is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings could make FTNT a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
FTNT had positive earnings in the past year.
FTNT had a positive operating cash flow in the past year.
Each year in the past 5 years FTNT has been profitable.
In the past 5 years FTNT always reported a positive cash flow from operatings.
1.2 Ratios
FTNT has a better Return On Assets (20.01%) than 94.66% of its industry peers.
Looking at the Return On Equity, with a value of 254.88%, FTNT belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
FTNT has a better Return On Invested Capital (38.77%) than 98.22% 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 11.92%.
The last Return On Invested Capital (38.77%) for FTNT 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
FTNT has a Profit Margin of 28.58%. This is amongst the best in the industry. FTNT outperforms 90.04% of its industry peers.
In the last couple of years the Profit Margin of FTNT has grown nicely.
FTNT has a Operating Margin of 30.86%. This is amongst the best in the industry. FTNT outperforms 92.53% of its industry peers.
FTNT's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 80.86%, FTNT belongs to the top of the industry, outperforming 84.34% of the companies in the same industry.
In the last couple of years the Gross Margin of FTNT has remained more or less at the same level.
| 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%
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 about the same amout of shares outstanding than it did 1 year ago.
FTNT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, FTNT has an improved debt to assets ratio.
2.2 Solvency
FTNT has an Altman-Z score of 5.60. This indicates that FTNT is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 5.60, FTNT is in the better half of the industry, outperforming 74.38% of the companies in the same industry.
The Debt to FCF ratio of FTNT is 0.49, which is an excellent value as it means it would take FTNT, only 0.49 years of fcf income to pay off all of its debts.
FTNT's Debt to FCF ratio of 0.49 is amongst the best of the industry. FTNT outperforms 80.07% of its industry peers.
FTNT has a Debt/Equity ratio of 0.68. This is a neutral value indicating FTNT is somewhat dependend on debt financing.
FTNT has a Debt to Equity ratio of 0.68. This is in the lower half of the industry: FTNT underperforms 69.39% of its industry peers.
Even though the debt/equity ratio score it not favorable for FTNT, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 0.49 | ||
| Altman-Z | 5.6 |
ROIC/WACC3.54
WACC10.96%
2.3 Liquidity
A Current Ratio of 1.03 indicates that FTNT should not have too much problems paying its short term obligations.
FTNT's Current ratio of 1.03 is on the low side compared to the rest of the industry. FTNT is outperformed by 71.17% of its industry peers.
FTNT has a Quick Ratio of 1.03. This is a bad value and indicates that FTNT is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.94, FTNT is doing worse than 73.31% of the companies in the same industry.
FTNT 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 |
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
FTNT shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.78%.
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, FTNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.97% on average per year.
The Revenue is expected to grow by 13.02% on average over the next years. This is quite good.
EPS Next Y8.48%
EPS Next 2Y9.58%
EPS Next 3Y10.22%
EPS Next 5Y8.97%
Revenue Next Year14.58%
Revenue Next 2Y13.08%
Revenue Next 3Y12.27%
Revenue Next 5Y13.02%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 30.49, the valuation of FTNT can be described as expensive.
Based on the Price/Earnings ratio, FTNT is valued a bit cheaper than 64.06% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.89, FTNT is valued at the same level.
FTNT is valuated quite expensively with a Price/Forward Earnings ratio of 28.92.
61.21% of the companies in the same industry are more expensive than FTNT, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.59, FTNT is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.49 | ||
| Fwd PE | 28.92 |
4.2 Price Multiples
74.38% of the companies in the same industry are more expensive than FTNT, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 69.75% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.09 | ||
| EV/EBITDA | 27.11 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
FTNT has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.6
PEG (5Y)0.83
EPS Next 2Y9.58%
EPS Next 3Y10.22%
5. Dividend
5.1 Amount
No dividends for FTNT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
82.31
+1.28 (+1.58%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners71.66%
Inst Owner Change-1.75%
Ins Owners16.86%
Ins Owner Change-0.78%
Market Cap63.07B
Revenue(TTM)6.55B
Net Income(TTM)1.87B
Analysts68.4
Price Target91.48 (11.14%)
Short Float %3.19%
Short Ratio3.3
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.51%
Min EPS beat(2)6.18%
Max EPS beat(2)14.84%
EPS beat(4)4
Avg EPS beat(4)11.8%
Min EPS beat(4)6.18%
Max EPS beat(4)19.58%
EPS beat(8)8
Avg EPS beat(8)16.09%
EPS beat(12)12
Avg EPS beat(12)14.54%
EPS beat(16)16
Avg EPS beat(16)13.89%
Revenue beat(2)0
Avg Revenue beat(2)-1.19%
Min Revenue beat(2)-1.63%
Max Revenue beat(2)-0.75%
Revenue beat(4)1
Avg Revenue beat(4)-0.57%
Min Revenue beat(4)-1.99%
Max Revenue beat(4)2.1%
Revenue beat(8)2
Avg Revenue beat(8)-0.57%
Revenue beat(12)3
Avg Revenue beat(12)-0.84%
Revenue beat(16)5
Avg Revenue beat(16)-0.44%
PT rev (1m)0.15%
PT rev (3m)-17.91%
EPS NQ rev (1m)0.01%
EPS NQ rev (3m)2.83%
EPS NY rev (1m)0.05%
EPS NY rev (3m)1.6%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.57%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.49 | ||
| Fwd PE | 28.92 | ||
| P/S | 9.62 | ||
| P/FCF | 31.09 | ||
| P/OCF | 25.76 | ||
| P/B | 85.8 | ||
| P/tB | 172.05 | ||
| EV/EBITDA | 27.11 |
EPS(TTM)2.7
EY3.28%
EPS(NY)2.85
Fwd EY3.46%
FCF(TTM)2.65
FCFY3.22%
OCF(TTM)3.19
OCFY3.88%
SpS8.55
BVpS0.96
TBVpS0.48
PEG (NY)3.6
PEG (5Y)0.83
Graham Number7.63
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 20.01% | ||
| ROE | 254.88% | ||
| ROCE | 44.21% | ||
| ROIC | 38.77% | ||
| ROICexc | 122.19% | ||
| ROICexgc | 163.76% | ||
| OM | 30.86% | ||
| PM (TTM) | 28.58% | ||
| GM | 80.86% | ||
| FCFM | 30.95% |
ROA(3y)15.82%
ROA(5y)13.96%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)28.58%
ROIC(5y)24.19%
ROICexc(3y)95.75%
ROICexc(5y)91.08%
ROICexgc(3y)117.7%
ROICexgc(5y)117.86%
ROCE(3y)32.59%
ROCE(5y)27.58%
ROICexgc growth 3Y23.93%
ROICexgc growth 5Y1.09%
ROICexc growth 3Y22.17%
ROICexc growth 5Y2.73%
OM growth 3Y16.85%
OM growth 5Y13.69%
PM growth 3Y17.3%
PM growth 5Y13.83%
GM growth 3Y1.97%
GM growth 5Y1.17%
F-Score8
Asset Turnover0.7
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 0.49 | ||
| Debt/EBITDA | 0.23 | ||
| Cap/Depr | 284.09% | ||
| Cap/Sales | 6.4% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 112.8% | ||
| Profit Quality | 108.26% | ||
| Current Ratio | 1.03 | ||
| Quick Ratio | 0.94 | ||
| Altman-Z | 5.6 |
F-Score8
WACC10.96%
ROIC/WACC3.54
Cap/Depr(3y)252.71%
Cap/Depr(5y)258.35%
Cap/Sales(3y)5.53%
Cap/Sales(5y)6.06%
Profit Quality(3y)142.53%
Profit Quality(5y)164.41%
High Growth Momentum
Growth
EPS 1Y (TTM)26.17%
EPS 3Y43.86%
EPS 5Y36.84%
EPS Q2Q%17.46%
EPS Next Y8.48%
EPS Next 2Y9.58%
EPS Next 3Y10.22%
EPS Next 5Y8.97%
Revenue 1Y (TTM)14.78%
Revenue growth 3Y21.24%
Revenue growth 5Y22.46%
Sales Q2Q%14.38%
Revenue Next Year14.58%
Revenue Next 2Y13.08%
Revenue Next 3Y12.27%
Revenue Next 5Y13.02%
EBIT growth 1Y24.11%
EBIT growth 3Y41.66%
EBIT growth 5Y39.22%
EBIT Next Year19.33%
EBIT Next 3Y14.96%
EBIT Next 5Y16.33%
FCF growth 1Y-1.72%
FCF growth 3Y16%
FCF growth 5Y21.29%
OCF growth 1Y7.75%
OCF growth 3Y14.62%
OCF growth 5Y22.82%
FORTINET INC / FTNT FAQ
What is the ChartMill fundamental rating of FORTINET INC (FTNT) stock?
ChartMill assigns a fundamental rating of 7 / 10 to FTNT.
What is the valuation status for FTNT stock?
ChartMill assigns a valuation rating of 4 / 10 to FORTINET INC (FTNT). This can be considered as Fairly Valued.
How profitable is FORTINET INC (FTNT) stock?
FORTINET INC (FTNT) has a profitability rating of 9 / 10.
What is the earnings growth outlook for FORTINET INC?
The Earnings per Share (EPS) of FORTINET INC (FTNT) is expected to grow by 8.48% in the next year.