Why NASDAQ:FTNT Is a Promising High-Growth Stock in the Midst of Consolidation.

Growth investors are on the lookout for stocks displaying robust revenue and EPS growth. In this analysis, we'll assess whether FORTINET INC (NASDAQ:FTNT) aligns with growth investing criteria, especially as it consolidates and signals a possible breakout. As always, investors should conduct their own research, but FORTINET INC has surfaced on our radar for growth with base formation, warranting further examination.

Evaluating Growth: NASDAQ:FTNT

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:FTNT has received a 8 out of 10:

• The Earnings Per Share has grown by an impressive 70.87% over the past year.
• FTNT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 41.93% yearly.
• The Revenue has grown by 30.71% in the past year. This is a very strong growth!
• The Revenue has been growing by 24.20% on average over the past years. This is a very strong growth!
• Based on estimates for the next years, FTNT will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.81% 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 19.71% on average per year.

Health Assessment of NASDAQ:FTNT

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:FTNT has earned a 8 out of 10:

• FTNT has an Altman-Z score of 5.03. This indicates that FTNT is financially healthy and has little risk of bankruptcy at the moment.
• With a decent Altman-Z score value of 5.03, FTNT is doing good in the industry, outperforming 77.50% of the companies in the same industry.
• FTNT has a debt to FCF ratio of 0.50. This is a very positive value and a sign of high solvency as it would only need 0.50 years to pay back of all of its debts.
• FTNT has a better Debt to FCF ratio (0.50) than 82.14% of its industry peers.
• Although FTNT 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.
• 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.

Exploring NASDAQ:FTNT's Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:FTNT has earned a 9 out of 10:

• FTNT has a better Return On Assets (14.15%) than 96.07% of its industry peers.
• FTNT's Return On Equity of 329.83% is amongst the best of the industry. FTNT outperforms 99.64% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 23.22%, FTNT belongs to the top of the industry, outperforming 97.50% of the companies in the same industry.
• FTNT had an Average Return On Invested Capital over the past 3 years of 18.64%. This is significantly above the industry average of 10.81%.
• The 3 year average ROIC (18.64%) for FTNT is below the current ROIC(23.22%), indicating increased profibility in the last year.
• The Profit Margin of FTNT (21.24%) is better than 93.57% of its industry peers.
• FTNT's Profit Margin has improved in the last couple of years.
• FTNT has a better Operating Margin (23.48%) than 93.21% of its industry peers.
• FTNT's Operating Margin has improved in the last couple of years.
• With a decent Gross Margin value of 76.26%, FTNT is doing good in the industry, outperforming 72.86% of the companies in the same industry.

How do we evaluate the setup for NASDAQ:FTNT?

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the level of consolidation in the stock based on multiple short-term technical indicators. Currently, NASDAQ:FTNT has a 7 as its setup rating, indicating its current consolidation status.

FTNT has a poor technical rating and the quality of the setup is also not perfect at the moment. Price movement has been a little bit too volatile to find a nice entry and exit point. It is probably a good idea to wait for a consolidation first.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

Our latest full fundamental report of FTNT contains the most current fundamental analsysis.

For an up to date full technical analysis you can check the technical report of FTNT

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.