FORTINET INC (FTNT) Stock Fundamental Analysis
USA - NASDAQ:FTNT - US34959E1091 - Common Stock
83.6 USD
-1.67 (-1.96%)
83.75 USD
+0.15 (+0.18%)
FTNT gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 279 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 growing strongly while it is still valued neutral. This is a good combination! These ratings would make FTNT suitable 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.
In the past 5 years FTNT has always been profitable.
FTNT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
FTNT's Return On Assets of 18.23% is amongst the best of the industry. FTNT outperforms 93.91% of its industry peers.
With an excellent Return On Equity value of 94.14%, FTNT belongs to the best of the industry, outperforming 98.92% of the companies in the same industry.
The Return On Invested Capital of FTNT (29.24%) is better than 96.77% of its industry peers.
The Average Return On Invested Capital over the past 3 years for FTNT is significantly above the industry average of 11.86%.
The 3 year average ROIC (28.58%) for FTNT is below the current ROIC(29.24%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.23% | ||
| ROE | 94.14% | ||
| ROIC | 29.24% |
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 better Profit Margin (30.60%) than 91.40% of its industry peers.
In the last couple of years the Profit Margin of FTNT has grown nicely.
With an excellent Operating Margin value of 30.85%, FTNT belongs to the best of the industry, outperforming 93.19% of the companies in the same industry.
In the last couple of years the Operating Margin of FTNT has grown nicely.
With an excellent Gross Margin value of 81.42%, FTNT belongs to the best of the industry, outperforming 85.66% of the companies in the same industry.
FTNT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.85% | ||
| PM (TTM) | 30.6% | ||
| GM | 81.42% |
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.
The number of shares outstanding for FTNT remains at a similar level compared to 1 year ago.
The number of shares outstanding for FTNT has been reduced compared to 5 years ago.
FTNT has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 5.91 indicates that FTNT is not in any danger for bankruptcy at the moment.
FTNT's Altman-Z score of 5.91 is fine compared to the rest of the industry. FTNT outperforms 72.40% of its industry peers.
FTNT 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.
FTNT's Debt to FCF ratio of 0.49 is fine compared to the rest of the industry. FTNT outperforms 78.85% of its industry peers.
A Debt/Equity ratio of 0.24 indicates that FTNT is not too dependend on debt financing.
FTNT's Debt to Equity ratio of 0.24 is in line compared to the rest of the industry. FTNT outperforms 44.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 0.49 | ||
| Altman-Z | 5.91 |
ROIC/WACC2.58
WACC11.33%
2.3 Liquidity
FTNT has a Current Ratio of 1.33. This is a normal value and indicates that FTNT is financially healthy and should not expect problems in meeting its short term obligations.
FTNT's Current ratio of 1.33 is in line compared to the rest of the industry. FTNT outperforms 43.01% of its industry peers.
A Quick Ratio of 1.24 indicates that FTNT should not have too much problems paying its short term obligations.
FTNT has a Quick ratio (1.24) which is comparable to the rest of the industry.
The current and quick ratio evaluation for FTNT is rather negative, while it does have 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 | 1.33 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 34.90% 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, FTNT shows a quite strong growth in Revenue. The Revenue has grown by 14.46% in the last year.
FTNT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.46% yearly.
EPS 1Y (TTM)34.9%
EPS 3Y43.86%
EPS 5Y36.84%
EPS Q2Q%12.28%
Revenue 1Y (TTM)14.46%
Revenue growth 3Y21.24%
Revenue growth 5Y22.46%
Sales Q2Q%13.64%
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.
Based on estimates for the next years, FTNT will show a quite strong growth in Revenue. The Revenue will grow by 13.02% on average per year.
EPS Next Y8.45%
EPS Next 2Y9.62%
EPS Next 3Y10.32%
EPS Next 5Y8.97%
Revenue Next Year14.59%
Revenue Next 2Y13.11%
Revenue Next 3Y12.31%
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
With a Price/Earnings ratio of 32.28, FTNT can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 64.87% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.29. FTNT is around the same levels.
The Price/Forward Earnings ratio is 29.36, which means the current valuation is very expensive for FTNT.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 62.37% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.80. FTNT is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.28 | ||
| Fwd PE | 29.36 |
4.2 Price Multiples
FTNT's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. FTNT is cheaper than 74.91% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, FTNT is valued a bit cheaper than the industry average as 70.97% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.51 | ||
| EV/EBITDA | 28.31 |
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.
The excellent profitability rating of FTNT may justify a higher PE ratio.
PEG (NY)3.82
PEG (5Y)0.88
EPS Next 2Y9.62%
EPS Next 3Y10.32%
5. Dividend
5.1 Amount
No dividends for FTNT!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
83.6
-1.67 (-1.96%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners71.17%
Inst Owner Change-2.51%
Ins Owners16.94%
Ins Owner Change-0.77%
Market Cap64.06B
Analysts68.08
Price Target91.35 (9.27%)
Short Float %3.2%
Short Ratio2.72
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)6.39%
Min EPS beat(2)6.18%
Max EPS beat(2)6.61%
EPS beat(4)4
Avg EPS beat(4)13.02%
Min EPS beat(4)6.18%
Max EPS beat(4)19.74%
EPS beat(8)8
Avg EPS beat(8)15.55%
EPS beat(12)12
Avg EPS beat(12)14.84%
EPS beat(16)16
Avg EPS beat(16)13.18%
Revenue beat(2)0
Avg Revenue beat(2)-1.81%
Min Revenue beat(2)-1.99%
Max Revenue beat(2)-1.63%
Revenue beat(4)1
Avg Revenue beat(4)-0.41%
Min Revenue beat(4)-1.99%
Max Revenue beat(4)2.1%
Revenue beat(8)2
Avg Revenue beat(8)-0.84%
Revenue beat(12)4
Avg Revenue beat(12)-0.75%
Revenue beat(16)6
Avg Revenue beat(16)-0.1%
PT rev (1m)-18.02%
PT rev (3m)-17.49%
EPS NQ rev (1m)0%
EPS NQ rev (3m)2.62%
EPS NY rev (1m)0%
EPS NY rev (3m)1.88%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.63%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.15%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 32.28 | ||
| Fwd PE | 29.36 | ||
| P/S | 10.11 | ||
| P/FCF | 31.51 | ||
| P/OCF | 26.68 | ||
| P/B | 31.09 | ||
| P/tB | 38.17 | ||
| EV/EBITDA | 28.31 |
EPS(TTM)2.59
EY3.1%
EPS(NY)2.85
Fwd EY3.41%
FCF(TTM)2.65
FCFY3.17%
OCF(TTM)3.13
OCFY3.75%
SpS8.27
BVpS2.69
TBVpS2.19
PEG (NY)3.82
PEG (5Y)0.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.23% | ||
| ROE | 94.14% | ||
| ROCE | 33.34% | ||
| ROIC | 29.24% | ||
| ROICexc | 131.78% | ||
| ROICexgc | 186.57% | ||
| OM | 30.85% | ||
| PM (TTM) | 30.6% | ||
| GM | 81.42% | ||
| FCFM | 32.07% |
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%
ROICexcg growth 3Y23.93%
ROICexcg 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 Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 0.49 | ||
| Debt/EBITDA | 0.24 | ||
| Cap/Depr | 264.7% | ||
| Cap/Sales | 5.81% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 114.64% | ||
| Profit Quality | 104.8% | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.24 | ||
| Altman-Z | 5.91 |
F-Score8
WACC11.33%
ROIC/WACC2.58
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)34.9%
EPS 3Y43.86%
EPS 5Y36.84%
EPS Q2Q%12.28%
EPS Next Y8.45%
EPS Next 2Y9.62%
EPS Next 3Y10.32%
EPS Next 5Y8.97%
Revenue 1Y (TTM)14.46%
Revenue growth 3Y21.24%
Revenue growth 5Y22.46%
Sales Q2Q%13.64%
Revenue Next Year14.59%
Revenue Next 2Y13.11%
Revenue Next 3Y12.31%
Revenue Next 5Y13.02%
EBIT growth 1Y34.55%
EBIT growth 3Y41.66%
EBIT growth 5Y39.22%
EBIT Next Year18.49%
EBIT Next 3Y16.12%
EBIT Next 5Y17.24%
FCF growth 1Y2.77%
FCF growth 3Y16%
FCF growth 5Y21.29%
OCF growth 1Y8.95%
OCF growth 3Y14.62%
OCF growth 5Y22.82%