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Fortinet (FTNT) Gains But Lags Market: What You Should Know

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Fortinet (FTNT - Free Report) closed the most recent trading day at $53.85, moving +1.42% from the previous trading session. This move lagged the S&P 500's daily gain of 1.47%. At the same time, the Dow lost 0.11%, and the tech-heavy Nasdaq gained 7.94%.

Coming into today, shares of the network security company had gained 9.92% in the past month. In that same time, the Computer and Technology sector gained 14.02%, while the S&P 500 gained 7.41%.

Wall Street will be looking for positivity from Fortinet as it approaches its next earnings report date. This is expected to be February 7, 2023. In that report, analysts expect Fortinet to post earnings of $0.39 per share. This would mark year-over-year growth of 56%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.29 billion, up 34.15% from the year-ago period.

Investors might also notice recent changes to analyst estimates for Fortinet. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.09% lower. Fortinet is currently a Zacks Rank #3 (Hold).

Looking at its valuation, Fortinet is holding a Forward P/E ratio of 38.81. For comparison, its industry has an average Forward P/E of 29.85, which means Fortinet is trading at a premium to the group.

We can also see that FTNT currently has a PEG ratio of 2.16. 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 2.18 based on yesterday's closing prices.

The Security industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 197, which puts it in the bottom 22% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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