80.31 USD
-0.51 (-0.63%)
80.15 USD
-0.16 (-0.2%)
We assign a fundamental rating of 7 out of 10 to FTNT. FTNT was compared to 276 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 overvalued while it is showing excellent growth. This is an interesting 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.
Each year in the past 5 years FTNT had a positive operating cash flow.
1.2 Ratios
FTNT has a Return On Assets of 20.01%. This is amongst the best in the industry. FTNT outperforms 96.01% of its industry peers.
FTNT's Return On Equity of 254.88% is amongst the best of the industry. FTNT outperforms 100.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 38.77%, FTNT belongs to the top of the industry, outperforming 98.55% of the companies in the same industry.
FTNT had an Average Return On Invested Capital over the past 3 years of 28.58%. This is significantly above the industry average of 10.78%.
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 88.77% of its industry peers.
In the last couple of years the Profit Margin of FTNT has grown nicely.
The Operating Margin of FTNT (30.86%) is better than 92.75% of its industry peers.
In the last couple of years the Operating Margin of FTNT has grown nicely.
The Gross Margin of FTNT (80.86%) is better than 83.70% 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so FTNT is creating value.
The number of shares outstanding for FTNT remains at a similar level compared to 1 year ago.
Compared to 5 years ago, FTNT has less shares outstanding
Compared to 1 year ago, FTNT has an improved debt to assets ratio.
2.2 Solvency
FTNT has an Altman-Z score of 5.47. 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 5.47, FTNT is in the better half of the industry, outperforming 73.91% 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 has a Debt to FCF ratio of 0.49. This is in the better half of the industry: FTNT outperforms 78.99% of its industry peers.
A Debt/Equity ratio of 0.68 indicates that FTNT is somewhat dependend on debt financing.
FTNT's Debt to Equity ratio of 0.68 is on the low side compared to the rest of the industry. FTNT is outperformed by 70.29% 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 0.49 | ||
| Altman-Z | 5.47 |
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.
The Current ratio of FTNT (1.03) is worse than 73.55% 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.
The Quick ratio of FTNT (0.94) is worse than 76.81% of its industry peers.
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 | 1.03 | ||
| Quick Ratio | 0.94 |
3. Growth
3.1 Past
FTNT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.17%, which is quite impressive.
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%.
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 9.01% on average per year.
FTNT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.42% yearly.
EPS Next Y15.92%
EPS Next 2Y12.37%
EPS Next 3Y11.92%
EPS Next 5Y9.01%
Revenue Next Year14.64%
Revenue Next 2Y12.93%
Revenue Next 3Y12.15%
Revenue Next 5Y12.42%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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
A Price/Earnings ratio of 29.74 indicates a quite expensive valuation of FTNT.
Compared to the rest of the industry, the Price/Earnings ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 63.77% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of FTNT to the average of the S&P500 Index (26.77), we can say FTNT is valued inline with the index average.
A Price/Forward Earnings ratio of 26.84 indicates a quite expensive valuation of FTNT.
Based on the Price/Forward Earnings ratio, FTNT is valued a bit cheaper than 64.13% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of FTNT to the average of the S&P500 Index (23.35), we can say FTNT is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.74 | ||
| Fwd PE | 26.84 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, FTNT is valued a bit cheaper than 72.46% of the companies in the same industry.
70.65% of the companies in the same industry are more expensive than FTNT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.44 | ||
| EV/EBITDA | 26.19 |
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)1.87
PEG (5Y)0.81
EPS Next 2Y12.37%
EPS Next 3Y11.92%
5. Dividend
5.1 Amount
FTNT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
80.31
-0.51 (-0.63%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners70.69%
Inst Owner Change-3.02%
Ins Owners17.37%
Ins Owner Change-1.19%
Market Cap59.72B
Revenue(TTM)6.55B
Net Income(TTM)1.87B
Analysts67.76
Price Target88.72 (10.47%)
Short Float %3.83%
Short Ratio4.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
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)-0.38%
PT rev (3m)-2.88%
EPS NQ rev (1m)-0.01%
EPS NQ rev (3m)11.05%
EPS NY rev (1m)6.86%
EPS NY rev (3m)6.91%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.94%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.74 | ||
| Fwd PE | 26.84 | ||
| P/S | 9.11 | ||
| P/FCF | 29.44 | ||
| P/OCF | 24.4 | ||
| P/B | 81.24 | ||
| P/tB | 162.91 | ||
| EV/EBITDA | 26.19 |
EPS(TTM)2.7
EY3.36%
EPS(NY)2.99
Fwd EY3.73%
FCF(TTM)2.73
FCFY3.4%
OCF(TTM)3.29
OCFY4.1%
SpS8.81
BVpS0.99
TBVpS0.49
PEG (NY)1.87
PEG (5Y)0.81
Graham Number7.75
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 | 5.47 |
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 Y15.92%
EPS Next 2Y12.37%
EPS Next 3Y11.92%
EPS Next 5Y9.01%
Revenue 1Y (TTM)14.78%
Revenue growth 3Y21.24%
Revenue growth 5Y22.46%
Sales Q2Q%14.38%
Revenue Next Year14.64%
Revenue Next 2Y12.93%
Revenue Next 3Y12.15%
Revenue Next 5Y12.42%
EBIT growth 1Y24.11%
EBIT growth 3Y41.66%
EBIT growth 5Y39.22%
EBIT Next Year25.5%
EBIT Next 3Y15.68%
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 15.92% in the next year.