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 growing strongly while it is still valued neutral. This is a good combination! 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.
FTNT had positive earnings in each of the past 5 years.
FTNT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
FTNT has a better Return On Assets (20.01%) than 94.66% of its industry peers.
With an excellent Return On Equity value of 254.88%, FTNT belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
FTNT has a Return On Invested Capital of 38.77%. This is amongst the best in the industry. FTNT outperforms 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's Profit Margin of 28.58% is amongst the best of the industry. FTNT outperforms 90.04% of its industry peers.
FTNT's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 30.86%, FTNT belongs to the best of the industry, outperforming 92.53% of the companies in the same industry.
FTNT's Operating Margin has improved in the last couple of years.
The Gross Margin of FTNT (80.86%) is better than 84.34% of its industry peers.
FTNT's Gross Margin has been stable in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), FTNT 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.
The debt/assets ratio for FTNT has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.60 indicates that FTNT is not in any danger for bankruptcy at the moment.
FTNT's Altman-Z score of 5.60 is fine compared to the rest of the industry. FTNT outperforms 74.38% of its industry peers.
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
WACC10.94%
2.3 Liquidity
FTNT has a Current Ratio of 1.03. 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 1.03, FTNT is doing worse than 71.17% of the companies in the same industry.
A Quick Ratio of 0.94 indicates that FTNT may have some problems paying its short term obligations.
With a Quick ratio value of 0.94, FTNT is not doing good in the industry: 73.31% of the companies in the same industry are doing better.
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.
Measured over the past years, FTNT shows a very strong growth in Earnings Per Share. The EPS has been growing by 36.84% on average per year.
Looking at the last year, FTNT shows a quite strong growth in Revenue. The Revenue has grown by 14.78% 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)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.
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 Y8.48%
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.
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 30.49 indicates a quite expensive valuation of FTNT.
Based on the Price/Earnings ratio, FTNT is valued a bit cheaper than 64.06% of the companies in the same industry.
FTNT's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.89.
With a Price/Forward Earnings ratio of 28.92, FTNT can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 61.21% of the companies listed in the same industry.
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
FTNT's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. FTNT is cheaper than 74.38% 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 69.75% of the companies are valued more expensively.
| 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 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.
PEG (NY)3.6
PEG (5Y)0.83
EPS Next 2Y9.58%
EPS Next 3Y10.22%
5. Dividend
5.1 Amount
FTNT does not give a dividend.
| 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
WACC10.94%
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.