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Fortinet (FTNT) to Report Q4 Earnings: What's in Store?

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Fortinet (FTNT - Free Report) is scheduled to report fourth-quarter 2021 results on Feb 3.

For the fourth-quarter of 2021, the company projects non-GAAP revenues between $940 million and $970 million. The Zacks Consensus Estimate for the same is pegged at $962.1 million, suggesting year-over-year growth of 28.6%.

Fortinet anticipates non-GAAP earnings from continuing operations in the range of $1.10 and $1.15 per share. The Zacks Consensus Estimate stands at $1.14 per share, suggesting growth of 7.6% from the year-ago reported figure.

The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 8.9%.

Factors to Note

Fortinet’s fourth-quarter performance is likely to have benefited from higher global cybersecurity spending. The growing adoption of Software-Defined Wide Area Network (“SD-WAN”) solutions might have acted as a tailwind. Per Futuriom, the market size for SD-WAN solutions is likely to reach $4.6 billion by 2023 from $2.6 billion in 2021, witnessing a CAGR of 34%.

The rapid adoption of FortiGate-based secure SD-WAN offerings is anticipated to have supported Fortinet’s Product segment. The Zacks Consensus Estimate for Product revenues in the December-end quarter stands at $381 million, suggesting year-over-year growth of 13.02%.

During the fourth quarter, Fortinet is expected to have gained from the heightened demand for security and networking products amid the coronavirus crisis as a huge global workforce is working remotely. Its quarterly performance is likely to have benefited from a robust momentum in FortiGate virtual machines, which is driving the firm’s private and public cloud billings. Management forecast billings in the band of $1.165-$1.215 million for the October-December quarter.

FortiGuard security subscriptions and FortiCare technical support services are likely to have gained solid traction, aiding the company’s Services segment. The Zacks Consensus Estimate for quarterly Services revenues is pegged at $577 million, indicating a year-over-year improvement of 8.8%.

Fortinet, Inc. Price and EPS Surprise

Fortinet, Inc. Price and EPS Surprise

Fortinet, Inc. price-eps-surprise | Fortinet, Inc. Quote

 

However, capital expenditures are expected to have flared up sequentially. Management had estimated fourth-quarter capital expenditures between $170 million and $190 million, in its last earnings call.

Worldwide supply chain constraints, including the backlog in Fabric products, are predicted to have weighed on Fortinet’s fourth-quarter performance.

What Our Model Unveils

Our proven model predicts an earnings beat for Fortinet this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Fortinet currently has a Zacks Rank #3 and an Earnings ESP of +1.17%. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Other Stocks With Favorable Combinations

Per our model, Cushman & Wakefield (CWK - Free Report) , STAAR Surgical (STAA - Free Report) and Jones Lang LaSalle (JLL - Free Report) also have the right combination of elements to post an earnings beat in their upcoming releases.

Cushman & Wakefield has a Zacks Rank #1 and an Earnings ESP of +6.45%. The company is scheduled to report fourth-quarter 2021 results on Feb 24. Its earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 110.3%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for the fourth-quarter earnings of Cushman & Wakefield is pegged at 62 cents per share, suggesting year-over-year growth of 44.2%. The consensus mark for revenues stands at $2.66 billion, indicating a decrease of 17.1% year over year.

STAAR Surgical is slated to report fourth-quarter 2021 results on Feb 23. The stock has a Zacks Rank #1 and an Earnings ESP of +9.68%. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 306.1%.

The Zacks Consensus Estimate for STAAR Surgical’s quarterly earnings stands at 16 cents per share, suggesting a year-over-year improvement of 14.3%. Its quarterly revenues are estimated to increase 28.9% year over year to $59.3 million.

Jones Lang LaSalle has a Zacks Rank #2 and an Earnings ESP of +9.23%. The company is scheduled to report fourth-quarter 2021 results on Feb 28. Its earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 128.7%.

The Zacks Consensus Estimate for Jones Lang LaSalle s’ fourth-quarter earnings is pegged at $6.68 per share, suggesting year-over-year growth of 26.3%. The consensus mark for revenues stands at $5.51 billion, indicating a year-over-year improvement of 13.7%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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