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On Friday, Piper Sandler analyst Rob Owens increased the price target on Fortinet stock (NASDAQ:FTNT) to $135 from $120, while maintaining an Overweight rating. Owens highlighted the company’s strong product growth and record margins as key positives, with InvestingPro data showing an impressive gross profit margin of 79.71%. He noted that Fortinet’s fourth quarter showed elements that would appeal to both bulls and bears in the market. The 18% growth in product sales was seen as evidence of an emerging refresh cycle, and the company’s ability to secure large deals was also emphasized. According to InvestingPro, the company maintains a "GREAT" financial health score, with 18+ additional ProTips available to subscribers.
Despite the positive aspects, Owens acknowledged some concerns that could temper optimism. He pointed to a guide down for organic billings in 2025, cautious remarks regarding the potential impact of tariffs, and additional turnover in management as factors that might cause some hesitation among investors. With revenue growth of 10.4% over the last twelve months and strong cash flows, he ultimately concluded that the strengths outweigh the weaknesses.
The analyst’s commentary reflects a belief that the positives, such as the company’s product strength and margin performance, are significant enough to support a bullish stance on the stock. The reiteration of the Overweight rating and the increased price target to $135 suggest confidence in Fortinet’s ongoing performance and market position. InvestingPro’s Fair Value analysis suggests the stock is currently trading above its Fair Value, with the stock price near its 52-week high of $105.82.
Fortinet’s fourth quarter evidently closed out the year with a mixture of factors that could influence different investor perspectives. The company’s ability to grow its product segment by 18% and set new records for margins, coupled with the securing of large deals, were highlighted as major accomplishments.
In conclusion, despite some concerns about organic billings, tariff impacts, and management changes, Piper Sandler sees a positive outlook for Fortinet. The firm’s analysis led to a reaffirmation of the Overweight rating and an elevated price target, signaling an expectation of continued success for the cybersecurity company.
In other recent news, Fortinet, a cybersecurity firm, has seen a series of revisions to its stock price target by various analysts. Stifel raised the target to $115 from $103, indicating the company’s potential in the upcoming firewall refresh cycle and projected revenue surpassing expectations. Similarly, Cantor Fitzgerald increased its target to $115, following a report of Fortinet’s total billings growth of 7.3% year-over-year and a robust growth of 30% in the Small and Medium Business segment.
In another development, Cantor Fitzgerald later lifted the target to $110, citing a favorable demand outlook for 2025 and Fortinet’s progress in developing its Secure Access Service Edge and Security Operations offerings. Baird, while downgrading the rating from Outperform to Neutral, increased the price target to $112, acknowledging Fortinet’s notable performance and anticipation of revenue growth reacceleration.
Lastly, Rosenblatt Securities raised its price target to $115, based on a positive outlook for Fortinet’s 2025 budgets and a strong product refresh cycle over the next 18 months. These adjustments reflect recent developments and underscore Fortinet’s robust financial performance and promising market potential.
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