- Giugno 29, 2022
- Posted by: Oliver
- Categoria: Economics, Finance & accounting
Based out of California, Fortinet offers cybersecurity solutions such as physical firewalls, antivirus software, intrusion prevention systems, and endpoint security components. The company has consistently outperformed Wall Street earnings expectations. FTNT stock has lost 11.2% year-to-date compared to gaining 19.7% over the past year.
Eyal has an impressively bullish call on FTNT stock with a price target of $425, which implies a staggering 618.7% upside potential to current levels. Eyal’s price target is based on 13 times his 2023 revenue estimates.
Other analysts, however, have a cautious view of FTNT stock with a Moderate Buy consensus rating based on 15 Buys and six Holds. The average Fortinet price target of $71.32 implies 20.6% upside potential to current levels.
In a mid-quarter check report, Eyal noted that Fortinet is currently tracking ahead of the consensus revenue/earnings per share (EPS) estimates of $1.025B/$1.09.
This, he believes, is powered by broad-based demand for Fortinet’s network security and cloud solutions with healthy momentum across all geographies. The analyst sees strong demand for FTNT’s mid and high-end appliances from customers seeking higher throughput, lower latency, and a lower total cost of ownership.
Moreover, the analyst believes that Fortinet’s SD-WAN offerings will strengthen its competitive positioning once rival VMware (VMW) gets acquired by Broadcom (AVGO).
Eyal also believes that Fortinet is efficiently managing the ongoing supply chain issues by undertaking steps such as “re-designing products, re-prioritizing component allocations, qualifying additional suppliers, shifting to air freight from ocean freight, and increasing inventory purchase commitments.”
As per Eyal, Fortinet is increasingly seen as the go-to vendor for both digital transformation and on-premise defense hardening, making the company one of the leading hybrid security vendors.
Eyal concluded, “FTNT is executing efficiently into a favorable demand environment, targeting a $138B TAM that is set to expand to $199B by 2026 (10% CAGR). We have confidence in the company’s ability to achieve both its 2022 guidance and its long-term targets.”
Notably, Eyal has given consistent Buy ratings on FTNT stock since 2013 with a success rate of 88% and generated an average return per rating of 50.9%.
