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

Zacks Equity Research

In the latest trading session, Fortinet (FTNT) closed at $106.76, marking a -0.18% move from the previous day. This change lagged the S&P 500's 0.3% gain on the day. Elsewhere, the Dow gained 0.27%, while the tech-heavy Nasdaq added 0.3%.

Coming into today, shares of the network security company had gained 2.92% in the past month. In that same time, the Computer and Technology sector gained 3.51%, while the S&P 500 gained 2.69%.

Investors will be hoping for strength from FTNT as it approaches its next earnings release. The company is expected to report EPS of $0.56, down 5.08% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales 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 revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. FTNT currently has a Zacks Rank of #1 (Strong Buy).

Looking at its valuation, FTNT is holding a Forward P/E ratio of 44.38. Its industry sports an average Forward P/E of 44.38, so we one might conclude that FTNT is trading at a no noticeable deviation comparatively.

Meanwhile, FTNT's PEG ratio is currently 3.17. 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 2.3 at yesterday's closing price.

The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 26, putting it in the top 11% 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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