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Fortinet (FTNT) Suffers a Larger Drop Than the General Market: Key Insights

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In the latest market close, Fortinet (FTNT - Free Report) reached $76.49, with a -1.37% movement compared to the previous day. The stock fell short of the S&P 500, which registered a loss of 0.93% for the day. Meanwhile, the Dow lost 0.41%, and the Nasdaq, a tech-heavy index, lost 1.53%.

The the stock of network security company has risen by 1.1% in the past month, lagging the Computer and Technology sector's gain of 2.77% and the S&P 500's gain of 2.17%.

Investors will be eagerly watching for the performance of Fortinet in its upcoming earnings disclosure. The company is expected to report EPS of $0.51, up 24.39% from the prior-year quarter. Alongside, our most recent consensus estimate is anticipating revenue of $1.48 billion, indicating a 10.7% upward movement from the same quarter last year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.03 per share and a revenue of $5.85 billion, indicating changes of +24.54% and +10.22%, respectively, from the former year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Fortinet. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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 has shifted 1.01% upward. Fortinet is holding a Zacks Rank of #1 (Strong Buy) right now.

In terms of valuation, Fortinet is currently trading at a Forward P/E ratio of 38.2. This expresses a premium compared to the average Forward P/E of 31.14 of its industry.

We can additionally observe that FTNT currently boasts a PEG ratio of 2.35. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Software industry had an average PEG ratio of 2.08 as trading concluded yesterday.

The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 74, finds itself in the top 30% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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