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Fortinet (FTNT) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Fortinet (FTNT) closed the most recent trading day at $112, moving +0.71% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.35%. At the same time, the Dow added 0.24%, and the tech-heavy Nasdaq gained 0.56%.

Heading into today, shares of the network security company had gained 6.01% over the past month, lagging the Computer and Technology sector's gain of 6.72% and outpacing the S&P 500's gain of 4.69% in that time.

Wall Street will be looking for positivity from FTNT as it approaches its next earnings report date. This 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%. Our most recent consensus estimate is calling for quarterly revenue of $600.78 million, up 18.5% from the year-ago period.

Any recent changes to analyst estimates for FTNT should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. FTNT is currently a Zacks Rank #1 (Strong Buy).

In terms of valuation, FTNT is currently trading at a Forward P/E ratio of 41.05. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 41.05.

We can also see that FTNT currently has a PEG ratio of 2.93. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Security was holding an average PEG ratio of 2.15 at yesterday's closing price.

The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 57, which puts it in the top 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow FTNT in the coming trading sessions, be sure to utilize Zacks.com.


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