Will This Target Price Increase Help Fortinet (FTNT) Today? (Update)

Update (9:40 a.m.): Updated with Monday market open information.

NEW YORK (TheStreet) -- Oppenheimer increased its target price on Fortinet  (FTNT) to $28 and increased its estimates. The firm cited positive channel checks as the reason for the move.

The stock was rising 0.92% to $23.06 at 9:39 a.m. on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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Separately, TheStreet Ratings team rates FORTINET INC as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate FORTINET INC (FTNT) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • FTNT's revenue growth has slightly outpaced the industry average of 10.3%. Since the same quarter one year prior, revenues rose by 17.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • FTNT has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, FTNT has a quick ratio of 1.52, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for FORTINET INC is currently very high, coming in at 71.94%. Regardless of FTNT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FTNT's net profit margin of 6.77% is significantly lower than the industry average.
  • Net operating cash flow has declined marginally to $46.67 million or 7.20% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, FORTINET INC has marginally lower results.
  • The share price of FORTINET INC has not done very well: it is down 8.32% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.
  • You can view the full analysis from the report here: FTNT Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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