Fortinet (FTNT) Stock Dips While Market Gains: Key Facts

In the latest close session, Fortinet (FTNT) was down 1.75% at $156.07. The stock trailed the S&P 500, which registered a daily gain of 0.86%. On the other hand, the Dow registered a gain of 0.98%, and the technology-centric Nasdaq increased by 0.96%.

Prior to today's trading, shares of the network security company had lost 3.98% lagged the Computer and Technology sector's loss of 0.56% and the S&P 500's loss of 1.96%.

Analysts and investors alike will be keeping a close eye on the performance of Fortinet in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.85, signifying a 14.86% increase compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $2.06 billion, indicating a 19.47% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $3.4 per share and revenue of $8.12 billion, which would represent changes of +23.19% and +19.37%, respectively, from the prior year.

Investors should also pay attention to any latest changes in analyst estimates for Fortinet. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Fortinet is currently sporting a Zacks Rank of #1 (Strong Buy).

With respect to valuation, Fortinet is currently being traded at a Forward P/E ratio of 46.66. This expresses no noticeable deviation compared to the average Forward P/E of 46.66 of its industry.

Also, we should mention that FTNT has a PEG ratio of 2.7. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Security stocks are, on average, holding a PEG ratio of 2.7 based on yesterday's closing prices.

The Security industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 48, putting it in the top 20% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these 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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This article originally published on Zacks Investment Research (zacks.com).

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