Why Fortinet Stock Is Trading Higher Today

Fortinet, Inc. FTNT shares are trading higher Wednesday after the company reported better-than-expected fourth-quarter financial results after the bell Tuesday.

The Details:

Several analysts have raised price targets on Fortinet following the earnings release:

• Wedbush analyst Daniel Ives maintained Fortinet with an Outperform and raised the price target from $75 to $86.
• Susquehanna analyst Anne Meisner maintained Fortinet with a Neutral and raised the price target from $55 to $80.
• BMO Capital analyst Keith Bachman maintained Fortinet with a Market Perform and raised the price target from $70 to $82.
• Mizuho analyst Gregg Moskowitz maintained Fortinet with a Neutral and raised the price target from $60 to $70.

However, HSBC analyst Stephen Bersey downgraded Fortinet from Hold to Reduce and announced a $57 price target.

Fortinet reported quarterly earnings of 51 cents per share, which beat the analyst consensus estimate of 43 cents by 18.6% after the market close on Tuesday.

The company reported quarterly sales of $1.42 billion, beating the analyst consensus estimate of $1.41 billion by 0.78% and representing a 10.68% increase over sales of $1.28 billion from last year.

“In the fourth quarter of 2023, Security Operations billings grew 44% year over year and SASE billings increased 19% year over year, driven by our successful sales strategy shift and the improved execution of our sales teams,” said Ken Xie, CEO of Fortinet.

“Our platform strategy is resonating with enterprises worldwide as we are a leader in Secure Networking and are the #1 firewall vendor for units shipped with FortiGates accounting for over half of the global deployment,” Xie continued.

Fortinet sees first-quarter adjusted earnings between 37 cents and 39 cents per share, versus the 37 cents estimate, and first-quarter revenue between $1.3 billion and $1.36 billion, versus the $1.26 billion estimate.

Fortinet anticipates full-year 2024 revenue between $5.71 billion and $5.81 billion and an adjusted EPS of $1.65 to $1.70.

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How To Buy FTNT Stock:

By now you're likely curious about how to participate in the market for Fortinet – be it to purchase shares, or even attempt to bet against the company.

Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy ‘fractional shares,' which allows you to own portions of stock without buying an entire share. For example, some stock, like Berkshire Hathaway, or Amazon.com, can cost thousands of dollars to own just one share. However, if you only want to invest a fraction of that, brokerages will allow you to do so.

In the the case of Fortinet, which is trading at $69.04 as of publishing time, $100 would buy you 1.45 shares of stock.

If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to ‘go short' a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading – either way it allows you to profit off of the share price decline.

FTNT Price Action: According to Benzinga Pro, Fortinet shares are trading up 3.5% at $69.80 at the time of publication.

Image: Pete Linforth from Pixabay