Fortinet, Inc.
Fortinet, Inc. Fundamental Analysis
Fortinet, Inc. (FTNT) shows moderate financial fundamentals with a PE ratio of 30.12, profit margin of 27.26%, and ROE of 1.24%. The company generates $7.0B in annual revenue with strong year-over-year growth of 12.27%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 69.6/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze FTNT's fundamental strength across five key dimensions:
Efficiency Score
ExcellentFTNT demonstrates superior asset utilization.
Valuation Score
ModerateFTNT shows balanced valuation metrics.
Growth Score
ExcellentFTNT delivers strong and consistent growth momentum.
Financial Health Score
ExcellentFTNT maintains a strong and stable balance sheet.
Profitability Score
ExcellentFTNT achieves industry-leading margins.
Key Financial Metrics
Is FTNT Expensive or Cheap?
P/E Ratio
FTNT trades at 30.12 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, FTNT's PEG of -73.80 indicates potential undervaluation.
Price to Book
The market values Fortinet, Inc. at 45.11 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 24.38 times EBITDA. This signals the market has high growth expectations.
How Well Does FTNT Make Money?
Net Profit Margin
For every $100 in sales, Fortinet, Inc. keeps $27.26 as profit after all expenses.
Operating Margin
Core operations generate 30.62 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $1.24 in profit for every $100 of shareholder equity.
ROA
Fortinet, Inc. generates $17.84 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Fortinet, Inc. generates strong operating cash flow of $2.67B, reflecting robust business health.
Free Cash Flow
Fortinet, Inc. generates strong free cash flow of $2.30B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $3.00 in free cash annually.
FCF Yield
FTNT converts 3.85% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
30.12
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-73.80
vs 25 benchmark
P/B Ratio
Price to book value ratio
45.11
vs 25 benchmark
P/S Ratio
Price to sales ratio
8.47
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.81
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.17
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
1.24
vs 25 benchmark
ROA
Return on assets percentage
0.18
vs 25 benchmark
ROCE
Return on capital employed
0.39
vs 25 benchmark
How FTNT Stacks Against Its Sector Peers
| Metric | FTNT Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 30.12 | 34.79 | Better (Cheaper) |
| ROE | 123.64% | 1185.00% | Weak |
| Net Margin | 27.26% | -131296.00% (disorted) | Strong |
| Debt/Equity | 0.81 | 0.43 | Weak (High Leverage) |
| Current Ratio | 1.17 | 4.90 | Neutral |
| ROA | 17.84% | -325472.00% (disorted) | Strong |
FTNT outperforms its industry in 3 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Fortinet, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
207.98%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
488.50%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
212.59%
Industry Style: Growth, Innovation, High Beta
High Growth