What happened

Fortinet (NASDAQ:FTNT) stock climbed 10.2% in September, according to data provided by S&P Global Market Intelligence, benefiting from continued momentum following second-quarter results and third-quarter guidance in August, new product offerings, and favorable analysis from Gartner.

FTNT Chart

FTNT data by YCharts.

Fortinet introduced its FortiNAC product line for Internet of Things (IoT) services on Sept. 4 and expanded features for use with Microsoft's Azure Cloud platform on Sept. 25. Gartner also published a report on Sept. 25 listing Fortinet as a leader for unified threat management (UTM).

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So what

FortiNAC is a network access control product line for device management and network segmentation for IoT security. The increasing importance and integration of big data services, growth for the number of connected devices, and recent high-profile security breaches have highlighted the need for reliable cybersecurity solutions, and Fortinet's strong position in its niche has the company poised to benefit from the connectivity boom. That outlook was reinforced after the company was listed as the top leader in Gartner's UTM Magic Quadrant Report for small-business firewalls, marking the ninth year that Fortinet has been named a leader in the category.

Now what

Fortinet stock has slipped 13.8% in October, reversing its September gains, but there doesn't appear to be any company-specific news behind the sell-off. Shares are still up more than 100% over the last year despite this month's declines. 

FTNT Chart

FTNT data by YCharts.

Fortinet is scheduled to report third-quarter earnings after market close on Nov. 1 and is guiding for sales between $455 million and $455 million, up roughly 20% year over year at the midpoint. Adjusted earnings for period are expected to come in between $0.41 and $0.43 per share, up 50% year over year at the midpoint. Shares trade at roughly 48 times this year's expected earnings and 7.5 times expected sales.

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