FORTINET INC (FTNT) Stock Fundamental Analysis
USA - NASDAQ:FTNT - US34959E1091 - Common Stock
81.94 USD
-0.37 (-0.45%)
81.94 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. FTNT has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. FTNT is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make FTNT suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year FTNT was profitable.
In the past year FTNT had a positive cash flow from operations.
Each year in the past 5 years FTNT has been profitable.
In the past 5 years FTNT always reported a positive cash flow from operatings.
1.2 Ratios
FTNT has a better Return On Assets (20.01%) than 94.66% of its industry peers.
The Return On Equity of FTNT (254.88%) is better than 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 98.22% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for FTNT is significantly above the industry average of 12.07%.
The 3 year average ROIC (28.58%) for FTNT is below the current ROIC(38.77%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 28.58%, FTNT belongs to the top of the industry, outperforming 90.04% of the companies in the same industry.
FTNT's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 30.86%, FTNT belongs to the top of the industry, outperforming 92.88% of the companies in the same industry.
FTNT's Operating Margin has improved in the last couple of years.
FTNT's Gross Margin of 80.86% is amongst the best of the industry. FTNT outperforms 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.
FTNT has about the same amout of shares outstanding than it did 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 5.67 indicates that FTNT is not in any danger for bankruptcy at the moment.
The Altman-Z score of FTNT (5.67) is better than 74.73% 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 has a better Debt to FCF ratio (0.49) than 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.
The Debt to Equity ratio of FTNT (0.68) is worse than 69.39% 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.68 | ||
| Debt/FCF | 0.49 | ||
| Altman-Z | 5.67 |
ROIC/WACC3.49
WACC11.1%
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 71.53% of its industry peers.
A Quick Ratio of 0.94 indicates that FTNT may have some problems paying its short term obligations.
FTNT's Quick ratio of 0.94 is on the low side compared to the rest of the industry. FTNT is outperformed by 74.38% of its industry peers.
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.
FTNT shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 36.84% yearly.
FTNT shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 14.78%.
Measured over the past years, FTNT shows a very strong growth in Revenue. The Revenue has been growing by 22.46% on average per year.
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
FTNT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.97% yearly.
FTNT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.02% yearly.
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 30.35 indicates a quite expensive valuation of FTNT.
Based on the Price/Earnings ratio, FTNT is valued a bit cheaper than 63.35% 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.
The Price/Forward Earnings ratio is 28.79, which means the current valuation is very expensive for FTNT.
Based on the Price/Forward Earnings ratio, FTNT is valued a bit cheaper than 60.50% of the companies in the same industry.
FTNT's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 34.59.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.35 | ||
| Fwd PE | 28.79 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of FTNT indicates a somewhat cheap valuation: FTNT is cheaper than 74.02% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, FTNT is valued a bit cheaper than 69.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.95 | ||
| EV/EBITDA | 27.56 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of FTNT may justify a higher PE ratio.
PEG (NY)3.58
PEG (5Y)0.82
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 |
81.94
-0.37 (-0.45%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners71.66%
Inst Owner Change-3.06%
Ins Owners16.86%
Ins Owner Change-0.78%
Market Cap62.79B
Revenue(TTM)6.55B
Net Income(TTM)1.87B
Analysts68.4
Price Target91.48 (11.64%)
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)9.5%
EPS NQ rev (3m)6.21%
EPS NY rev (1m)0.05%
EPS NY rev (3m)1.6%
Revenue NQ rev (1m)-0.78%
Revenue NQ rev (3m)-0.89%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.35 | ||
| Fwd PE | 28.79 | ||
| P/S | 9.58 | ||
| P/FCF | 30.95 | ||
| P/OCF | 25.65 | ||
| P/B | 85.41 | ||
| P/tB | 171.27 | ||
| EV/EBITDA | 27.56 |
EPS(TTM)2.7
EY3.3%
EPS(NY)2.85
Fwd EY3.47%
FCF(TTM)2.65
FCFY3.23%
OCF(TTM)3.19
OCFY3.9%
SpS8.55
BVpS0.96
TBVpS0.48
PEG (NY)3.58
PEG (5Y)0.82
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 | 5.67 |
F-Score8
WACC11.1%
ROIC/WACC3.49
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.