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Fortinet (FTNT) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

In the latest trading session, Fortinet (FTNT) closed at $117.99, marking a -0.91% move from the previous day. This move lagged the S&P 500's daily loss of 0.9%. Elsewhere, the Dow lost 0.58%, while the tech-heavy Nasdaq lost 0.93%.

Prior to today's trading, shares of the network security company had gained 10.01% over the past month. This has outpaced the Computer and Technology sector's gain of 6.54% and the S&P 500's gain of 3.3% in that time.

FTNT will be looking to display strength as it nears its next earnings release, which is expected to be February 6, 2020. In that report, analysts expect FTNT to post earnings of $0.70 per share. This would mark year-over-year growth of 18.64%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $603.25 million, up 18.98% from the year-ago period.

Investors should also note any recent changes to analyst estimates for FTNT. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.34% higher. FTNT is holding a Zacks Rank of #4 (Sell) right now.

Investors should also note FTNT's current valuation metrics, including its Forward P/E ratio of 43.92. Its industry sports an average Forward P/E of 43.92, so we one might conclude that FTNT is trading at a no noticeable deviation comparatively.

Investors should also note that FTNT has a PEG ratio of 3.14 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Security was holding an average PEG ratio of 2.37 at yesterday's closing price.

The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 192, putting it in the bottom 25% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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