The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Fortinet beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share increased significantly.
Gross margins shrank, operating margins were steady, net margins expanded.
Fortinet tallied revenue of $151.2 million. The 24 analysts polled by S&P Capital IQ hoped for revenue of $144.2 million on the same basis. GAAP reported sales were 25% higher than the prior-year quarter's $120.9 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.17. The 25 earnings estimates compiled by S&P Capital IQ predicted $0.15 per share. GAAP EPS of $0.13 for Q4 were 30% higher than the prior-year quarter's $0.10 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 72.6%, 50 basis points worse than the prior-year quarter. Operating margin was 23.2%, about the same as the prior-year quarter. Net margin was 14.2%, 60 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $139.6 million. On the bottom line, the average EPS estimate is $0.13.
Next year's average estimate for revenue is $618.9 million. The average EPS estimate is $0.61.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 98 members out of 111 rating the stock outperform, and 13 members rating it underperform. Among 21 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 18 give Fortinet a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Fortinet is outperform, with an average price target of $27.09.
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