NEW YORK (TheStreet) -- Shares of Fortinet (FTNT) were falling 3.3% to $41.77 on heavy trading volume Wednesday after the security software company received downgrades from analyst firms Citigroup and Robert W. Baird.
Citigroup lowered its rating for Fortinet to "neutral" from "buy" Wednesday, according to Barron's. The analyst firm raised its price target for the company to $44 from $41 despite the downgrade.
Citigroup analysts Walter Pritchard and James Fish said that while Fortinet benefitted from elevated growth rates in the firewall UTM market recently, its exposure is now a hindrance. The analysts believe the company's refresh activity is now plateauing.
In a separate note, Robert W. Baird downgraded Fortinet to "neutral" from "outperform," while also raising its price target to $46 from $40.
"We expect fundamentals to stay strong at Fortinet," analysts Jayson Noland and Connie Qian wrote. "Our checks have remained consistent and mostly positive. We are attempting to avoid thesis creep, and get more selective in the Security space with the understanding that we could be leaving some upside on the table."
About 3.6 million shares of Fortinet were traded by 3:44 p.m. Wednesday, above the company's average trading volume of about 1.6 million shares a day.
Insight from TheStreet's Research Team:
Fortinet (Technology -- FTNT:Nasdaq, 1,050 shares, 9.31%; $45 price target): The stock jumped 6% this week. On Tuesday, Oppenheimer reiterated its Outperform rating and bumped its price target to $46 from $39 after its mid-quarter channel checks came back with a positive read that business is tracking ahead of guidance. On Monday, UBS reiterated its Buy rating on the name and increased its price target to $49 from $43 as the analyst believes the company's valuation continues to look attractive and management has been offering improved execution.