Fortinet Analysts Lift Price Targets Post Compelling Billings Growth In Q4 And Guidance

Mizuho analyst Gregg Moskowitz maintained Fortinet Inc FTNT with a Neutral and raised the price target from $60 to $68.
FTNT reported a very solid 4Q. While revenue was below, billings growth of 31-32% Y/Y modestly exceeded the Street's ~30% Y/Y forecast. More importantly, FTNT provided a much better-than-expected outlook for 2023 that includes billings growth of 21% Y/Y.
Net, FTNT deserves credit for a much cleaner call than the analyst expected, although he remained concerned that the upside drivers to billings over the next 1-2 years could be limited.
Piper Sandler analyst Rob Owens maintained a Neutral and raised the price target from $57 to $64.
Despite the stricter macro, the 4Q results were vastly ahead of expectations, as broader security demand remained resilient across most geographies and verticals.
Though the 4Q 'budget flush' did not play out as historically, commentary around the pipeline and 2023 guidance were mainly optimistic as customers look to consolidate with platform vendors.
While the analyst was encouraged by execution and believes this reads well to others, he remained on the sidelines at current levels.
Raymond James analyst Adam Tindle maintained an Outperform and raised the price target from $60 to $70.
The re-rating followed 4Q results that featured mixed growth trends but vital profitability metrics and initial 2023 guidance that was better than the analyst's bogeys.
Sentiment on the stock deteriorated into the quarter, and shares are reacting accordingly.
Fortinet will have multiple levers to support a healthy business trajectory as margins should improve as growth normalizes. The analyst views FTNT as one of the better business models in one of the most attractive structural growth industries (Cybersecurity) across the technology segment.
BMO Capital analyst Keith Bachman maintained a Market Perform and raised the price target from $57 to $67.
The re-rating reflected Bachman's belief that weakness in the firewall market would cause FTNT's FY23 billings guide to be 18% or less (below consensus), yet the billings guide was 20.7% Y/Y at the midpoint.
The analyst thinks FTNT's share gains and lower market headwinds contributed to a better FY23 billings guide.
Citigroup analyst Fatima Boolani maintained a Buy and raised the price target from $65 to $67.
The analyst emphasized FTNT's profitable growth at scale, clear share gain evidence in large-budget markets, and fruits of a diverse business, especially in this macro, as the more consequential inputs to Boolani's positive investment thesis and counter to bears' "cyclical asset" narrative.
Price Action: FTNT shares traded higher by 11.22% at $59.81 on the last check Wednesday.

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