For those who appreciate growth without the sticker shock, NASDAQ:FTNT is worth considering.

Last update: Dec 22, 2023

Consider FORTINET INC (NASDAQ:FTNT) as an affordable growth stock, identified by our stock screening tool. NASDAQ:FTNT is showcasing impressive growth figures and is well-positioned in terms of profitability, solvency, and liquidity. Moreover, it seems to be priced reasonably. Let's dive deeper into the analysis.

Exploring NASDAQ:FTNT's Growth

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:FTNT scores a 8 out of 10:

FTNT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 56.37%, which is quite impressive.
FTNT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 41.93% yearly.
FTNT shows a strong growth in Revenue. In the last year, the Revenue has grown by 26.22%.
FTNT shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.20% yearly.
FTNT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.28% yearly.
FTNT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 17.51% yearly.

Understanding NASDAQ:FTNT's Valuation

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:FTNT has received a 5 out of 10:

FTNT's Price/Earnings ratio is a bit cheaper when compared to the industry. FTNT is cheaper than 73.93% of the companies in the same industry.
Based on the Price/Forward Earnings ratio, FTNT is valued a bit cheaper than 69.29% of the companies in the same industry.
81.07% of the companies in the same industry are more expensive than FTNT, based on the Enterprise Value to EBITDA ratio.
FTNT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. FTNT is cheaper than 85.00% of the companies in the same industry.
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 18.44% in the coming years.

Looking at the Health

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:FTNT, the assigned 8 reflects its health status:

FTNT has an Altman-Z score of 4.80. This indicates that FTNT is financially healthy and has little risk of bankruptcy at the moment.
FTNT's Altman-Z score of 4.80 is fine compared to the rest of the industry. FTNT outperforms 68.21% of its industry peers.
FTNT has a debt to FCF ratio of 0.48. This is a very positive value and a sign of high solvency as it would only need 0.48 years to pay back of all of its debts.
FTNT has a better Debt to FCF ratio (0.48) than 84.29% 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.
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.

Looking at the Profitability

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:FTNT, the assigned 9 is a significant indicator of profitability:

FTNT's Return On Assets of 15.39% is amongst the best of the industry. FTNT outperforms 95.71% of its industry peers.
FTNT has a better Return On Equity (1552.90%) than 100.00% of its industry peers.
With an excellent Return On Invested Capital value of 24.93%, FTNT belongs to the best of the industry, outperforming 98.57% 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 10.14%.
The last Return On Invested Capital (24.93%) for FTNT is above the 3 year average (18.64%), which is a sign of increasing profitability.
The Profit Margin of FTNT (22.25%) is better than 93.21% of its industry peers.
FTNT's Profit Margin has improved in the last couple of years.
The Operating Margin of FTNT (23.37%) is better than 93.57% of its industry peers.
In the last couple of years the Operating Margin of FTNT has grown nicely.
With a decent Gross Margin value of 76.44%, FTNT is doing good in the industry, outperforming 72.14% of the companies in the same industry.

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

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

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.