NasdaqGS:FTNT

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Fortinet, Inc. provides broad, integrated, and automated cybersecurity solutions worldwide. More Details


Snowflake Analysis

Flawless balance sheet and fair value.


Similar Companies

Share Price & News

How has Fortinet's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FTNT has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.4%

FTNT

-2.5%

US Software

-2.4%

US Market


1 Year Return

67.2%

FTNT

64.1%

US Software

18.2%

US Market

Return vs Industry: FTNT exceeded the US Software industry which returned 64.1% over the past year.

Return vs Market: FTNT exceeded the US Market which returned 19.5% over the past year.


Shareholder returns

FTNTIndustryMarket
7 Day-1.4%-2.5%-2.4%
30 Day9.8%9.6%4.2%
90 Day-4.1%9.8%6.3%
1 Year67.2%67.2%65.3%64.1%20.9%18.2%
3 Year222.1%222.1%147.3%139.0%41.2%31.8%
5 Year280.9%280.9%256.2%235.2%84.8%63.9%

Price Volatility Vs. Market

How volatile is Fortinet's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Fortinet undervalued compared to its fair value and its price relative to the market?

28.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FTNT ($128.82) is trading below our estimate of fair value ($180.72)

Significantly Below Fair Value: FTNT is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FTNT is good value based on its PE Ratio (52.9x) compared to the US Software industry average (63.5x).

PE vs Market: FTNT is poor value based on its PE Ratio (52.9x) compared to the US market (19x).


Price to Earnings Growth Ratio

PEG Ratio: FTNT is poor value based on its PEG Ratio (4.4x)


Price to Book Ratio

PB vs Industry: FTNT is overvalued based on its PB Ratio (38.3x) compared to the US Software industry average (7.4x).


Next Steps

Future Growth

How is Fortinet forecast to perform in the next 1 to 3 years based on estimates from 25 analysts?

12.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FTNT's forecast earnings growth (12.1% per year) is above the savings rate (2.2%).

Earnings vs Market: FTNT's earnings (12.1% per year) are forecast to grow slower than the US market (22.1% per year).

High Growth Earnings: FTNT's earnings are forecast to grow, but not significantly.

Revenue vs Market: FTNT's revenue (13.2% per year) is forecast to grow faster than the US market (10% per year).

High Growth Revenue: FTNT's revenue (13.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FTNT's Return on Equity is forecast to be high in 3 years time (38.3%)


Next Steps

Past Performance

How has Fortinet performed over the past 5 years?

61.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FTNT has high quality earnings.

Growing Profit Margin: FTNT's current net profit margins (17.5%) are lower than last year (19.1%).


Past Earnings Growth Analysis

Earnings Trend: FTNT's earnings have grown significantly by 61.8% per year over the past 5 years.

Accelerating Growth: FTNT's earnings growth over the past year (10.2%) is below its 5-year average (61.8% per year).

Earnings vs Industry: FTNT earnings growth over the past year (10.2%) underperformed the Software industry 12.8%.


Return on Equity

High ROE: FTNT's Return on Equity (75.6%) is considered outstanding.


Next Steps

Financial Health

How is Fortinet's financial position?


Financial Position Analysis

Short Term Liabilities: FTNT's short term assets ($2.2B) exceed its short term liabilities ($1.6B).

Long Term Liabilities: FTNT's short term assets ($2.2B) exceed its long term liabilities ($1.2B).


Debt to Equity History and Analysis

Debt Level: FTNT is debt free.

Reducing Debt: FTNT has not had any debt for past 5 years.

Debt Coverage: FTNT has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: FTNT has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Fortinet current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate FTNT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate FTNT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if FTNT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FTNT's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FTNT's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.7yrs

Average management tenure


CEO

Ken Xie (57 yo)

20yrs

Tenure

US$9,629,923

Compensation

Mr. Ken Xie founded Fortinet Inc., October 2000 and has been its Chief Executive Officer and Director since October 2000. Mr. Xie serves as an Advisor at WI Harper Group. He is a Strategic Advisor at Forge ...


CEO Compensation Analysis

Compensation vs Market: Ken's total compensation ($USD9.63M) is about average for companies of similar size in the US market ($USD11.20M).

Compensation vs Earnings: Ken's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Ken Xie
Founder20yrsUS$9.63m7.75%
$ 1.6b
Michael Xie
Founder19.67yrsUS$4.29m7.19%
$ 1.5b
Keith Jensen
CFO & Chief Accounting Officer2.67yrsUS$3.39m0.00049%
$ 102.2k
John Whittle
Executive VP of Corporate Development & Strategic Alliances14yrsUS$2.51m0.0019%
$ 398.2k
Ana Pease
Vice President of Talent Management & Operations0.75yrno datano data
Peter Salkowski
Vice President of Investor Relations2.67yrsno datano data
Patrice Perche
Senior Executive Vice President of Worldwide Sales & Support4.75yrsno datano data
John Maddison
Chief Marketing Officer & Executive VP of Products1.75yrsno datano data
Chris Perna
Vice President of Talent Acquisition0.75yrno datano data
Sandra Wheatley
Senior Vice President of Marketing1.75yrsno datano data
Philip Quade
Chief Information Security Officer3.75yrsno datano data
Pedro Paixao
President for Latin America and General Manager for Latin Americano datano datano data

2.7yrs

Average Tenure

54yo

Average Age

Experienced Management: FTNT's management team is considered experienced (2.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ken Xie
Founder20yrsUS$9.63m7.75%
$ 1.6b
Michael Xie
Founder19.67yrsUS$4.29m7.19%
$ 1.5b
Kenneth Goldman
Director0.17yrUS$369.22kno data
William Neukom
Lead Independent Director2.5yrsUS$337.06k0.033%
$ 7.0m
Christopher Paisley
Independent Director16.67yrsUS$342.74k0.047%
$ 9.8m
Ming Hsieh
Independent Director7.5yrsUS$330.50k0.0045%
$ 940.2k
Judith Sim
Independent Director5.33yrsUS$333.28k0.015%
$ 3.2m
Jean Hu
Independent Director1yrUS$225.10k0.0013%
$ 275.2k
Kelly Ducourty
Independent Director0.50yrno data0.00054%
$ 112.6k

5.3yrs

Average Tenure

57yo

Average Age

Experienced Board: FTNT's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: FTNT insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Fortinet, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Fortinet, Inc.
  • Ticker: FTNT
  • Exchange: NasdaqGS
  • Founded: 2000
  • Industry: Systems Software
  • Sector: Software
  • Market Cap: US$20.847b
  • Shares outstanding: 161.83m
  • Website: https://www.fortinet.com

Number of Employees


Location

  • Fortinet, Inc.
  • 899 Kifer Road
  • Sunnyvale
  • California
  • 94086
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FTNTNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDNov 2009
FO8DB (Deutsche Boerse AG)YesCommon StockDEEURNov 2009
0IR9LSE (London Stock Exchange)YesCommon StockGBUSDNov 2009
FTNT *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNNov 2009
F1TN34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

Fortinet, Inc. provides broad, integrated, and automated cybersecurity solutions worldwide. It offers FortiGate hardware and software licenses that provide various security and networking functions, includ ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/20 00:35
End of Day Share Price2020/10/19 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.