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1. Company Snapshot

1.a. Company Description

Fortinet, Inc.provides broad, integrated, and automated cybersecurity solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific.It offers FortiGate hardware and software licenses that provide various security and networking functions, including firewall, intrusion prevention, anti-malware, virtual private network, application control, web filtering, anti-spam, and wide area network acceleration.


The company also provides FortiSwitch product family that offers secure switching solutions for connecting customers their end devices; FortiAP product family, which provides secure wireless networking solutions; FortiExtender, a hardware appliance; FortiAnalyzer product family, which offers centralized network logging, analyzing, and reporting solutions; and FortiManager product family that provides central and scalable management solution for its FortiGate products.It offers FortiWeb product family provides web application firewall solutions; FortiMail product family that secure email gateway solutions; FortiSandbox technology that delivers proactive detection and mitigation services; FortiClient that provides endpoint protection with pattern-based anti-malware, behavior-based exploit protection, web-filtering, and an application firewall; FortiToken and FortiAuthenticator product families for multi-factor authentication to safeguard systems, assets, and data; and FortiEDR/XDR, an endpoint protection solution that provides both comprehensive machine-learning anti-malware execution and real-time post-infection protection.It provides security subscription, technical support, professional, and training services.


It sells its security solutions to channel partners and directly to various customers in telecommunications, technology, government, financial services, education, retail, manufacturing, and healthcare industries.It has strategic alliance with Linksys.Fortinet, Inc.


was incorporated in 2000 and is headquartered in Sunnyvale, California.

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1.b. Last Insights on FTNT

Fortinet's recent performance was driven by strong Q3 earnings, with EPS and revenues surpassing estimates, fueled by double-digit growth across segments. The company's security solutions, particularly SASE, showed momentum. A $3.4B net cash position and robust buybacks support EPS growth and financial resilience. Fortinet's established relationship with NATO and growing recurring revenues present opportunities. Despite a short-term price dip, analysts rate FTNT a Strong Buy with a $88.53 price target.

1.c. Company Highlights

2. Fortinet's Q3 Earnings: Strong Execution Drives Growth

Fortinet's third-quarter financial performance was robust, with total billings growing by 14% to $1.81 billion, driven by 19% growth in Unified SASE and 33% growth in SecOps. Revenue also grew by 14%, and the company achieved a record third-quarter operating margin of 37%. Earnings per share (EPS) came in at $0.74, beating analyst estimates of $0.631. The company's non-GAAP gross margin was also strong, and the service revenue growth is expected to improve in the second half of 2026.

Publication Date: Nov -06

📋 Highlights
  • 14% Revenue & Billing Growth: Q3 revenue and billing both rose 14%, with a record 37% operating margin.
  • Unified SASE 19% Growth: Driven by FortiSASE’s 100% billing growth, 15% of large enterprises now adopt it (↑55% YoY).
  • 26% Unified SASE & 11% SecOps Contribution: Combined 29% of total billings, up 3 points YoY, with $1.81B total billings.
  • 5x–10x Performance Edge: FortiASIC’s secure computing power outperforms competitors, reducing TCO and energy use.
  • 12–14% Full-Year Growth Guidance: $7.37B–$7.47B billings and $6.72B–$6.78B revenue, driven by Rule of 45 execution and market share gains.

Segment Performance

Fortinet's strong growth is driven by its key differentiated advantages, including its single OS integration of next-gen firewall, SD-WAN, and SASE on a single operating system, FortiOS. Unified SASE billing grew 19%, driven by FortiSASE billing growth of over 100%, making Fortinet one of the fastest-growing SASE leaders at scale. The company's leadership in firewall is enabled by FortiOS, which provides unified networking and security.

Guidance and Outlook

For the fourth quarter, Fortinet expects billings in the range of $2.185 billion to $2.285 billion, representing growth of 12% at the midpoint. Revenue is expected to be in the range of $1.825 billion to $1.885 billion, also representing growth of 12% at the midpoint. The company's guidance for the full year is billings in the range of $7.37 billion to $7.47 billion, representing growth of 14% at the midpoint.

Valuation

Fortinet's current valuation metrics indicate a premium, with a P/E Ratio of 34.0, P/S Ratio of 10.4, and EV/EBITDA of 26.45. The company's ROE is 120.75%, and ROIC is 26.13%. The market seems to have priced in significant growth expectations, and the company's ability to continue to deliver strong execution and gain market share will be crucial in justifying its current valuation.

Growth Prospects

Ken Xie mentioned that the company is targeting AI-native players, cloud providers, hyperscalers, and enterprise data centers, and the addressable opportunity is huge. The company's unique advantage in gaining market share is driven by its single OS integration and proprietary ASIC technology. Analysts estimate next year's revenue growth at 11.5%, and Fortinet's guidance suggests continued strong execution and growth prospects.

3. NewsRoom

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Fortinet: Cybersecurity Growth Story Unshaken After Recent Sell-Off

Dec -01

Source: seekingalpha.com

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Fortinet: An Undervalued Cybersecurity Play With Massive Buybacks

Dec -01

Source: seekingalpha.com

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Could the Next Trillion-Dollar AI Opportunity Be in Cybersecurity and Not Semiconductors?

Dec -01

Source: fool.com

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4 Security Stocks in Focus Amid the Prospering Industry Trend

Nov -28

Source: zacks.com

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Baltimore Washington Financial Advisors Inc. Buys 21,037 Shares of Fortinet, Inc. $FTNT

Nov -27

Source: defenseworld.net

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Fortinet's Slide Creates A Rare Buying Opportunity For Long-Term Investors

Nov -27

Source: seekingalpha.com

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CrowdStrike vs. Fortinet: Which Cybersecurity Stock Is the Better Buy?

Nov -24

Source: zacks.com

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FTNT INVESTOR ALERT: Bronstein, Gewirtz & Grossman LLC Announces that Fortinet, Inc. Investors with Substantial Losses Have Opportunity to Lead Class Action Lawsuit

Nov -21

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (14.00%)

6. Segments

Network Security Solutions

Expected Growth: 14.0%

Fortinet's network security solutions drive growth through increasing demand for cybersecurity, expanding customer base, and high renewal rates. The company's strong product portfolio, innovative technologies, and strategic acquisitions fuel its 14.0% growth, outpacing the industry average. FortiGate, FortiWeb, and FortiMail solutions lead the charge, addressing evolving threats and customer needs.

7. Detailed Products

FortiGate

A series of network security appliances that provide firewall, VPN, antivirus, and intrusion prevention capabilities.

FortiWeb

A web application firewall that protects web applications from attacks and data breaches.

FortiMail

An email security solution that protects against spam, phishing, and malware.

FortiClient

An endpoint security solution that provides antivirus, VPN, and vulnerability management capabilities.

FortiSandbox

An advanced threat protection solution that detects and prevents unknown threats.

FortiAnalyzer

A log analytics and reporting solution that provides visibility and insights into network security.

FortiManager

A network security management solution that provides centralized management and automation.

8. Fortinet, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Fortinet's products and services are highly specialized, making it difficult for substitutes to emerge. However, the increasing adoption of cloud-based security solutions poses a moderate threat.

Bargaining Power Of Customers

Fortinet's customers are largely enterprises and governments, which have limited bargaining power due to their dependence on Fortinet's security solutions.

Bargaining Power Of Suppliers

Fortinet has a diversified supply chain, and its suppliers have limited bargaining power due to the company's strong market position.

Threat Of New Entrants

The network security market has high barriers to entry, including significant R&D investments and regulatory hurdles, making it difficult for new entrants to compete with Fortinet.

Intensity Of Rivalry

The network security market is highly competitive, with established players like Cisco, Juniper, and Palo Alto competing fiercely with Fortinet for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 182.41%
Debt Cost 3.95%
Equity Weight -82.41%
Equity Cost 9.37%
WACC -0.53%
Leverage -221.34%

11. Quality Control: Fortinet, Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Oracle

A-Score: 4.9/10

Value: 2.2

Growth: 6.8

Quality: 6.0

Yield: 2.0

Momentum: 9.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Zscaler

A-Score: 4.9/10

Value: 2.0

Growth: 8.4

Quality: 4.6

Yield: 0.0

Momentum: 9.0

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
CrowdStrike

A-Score: 4.8/10

Value: 2.0

Growth: 8.8

Quality: 4.8

Yield: 0.0

Momentum: 9.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Palantir

A-Score: 4.8/10

Value: 0.0

Growth: 7.6

Quality: 8.5

Yield: 0.0

Momentum: 10.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Fortinet

A-Score: 4.8/10

Value: 0.8

Growth: 9.1

Quality: 8.5

Yield: 0.0

Momentum: 5.5

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Adobe

A-Score: 4.7/10

Value: 3.0

Growth: 7.7

Quality: 9.0

Yield: 0.0

Momentum: 1.5

Volatility: 7.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

85.18$

Current Price

85.18$

Potential

0.00%

Expected Cash-Flows