5 Best Cybersecurity Stocks to Buy Now

3.  Fortinet, Inc. (NASDAQ:FTNT)

Market cap as of August 15: $42.643 billion

Fortinet, Inc. (NASDAQ:FTNT) is a multinational corporation that develops and sells cybersecurity solutions. In March 2022, the company announced the termination of its services in Russia, and in the same month, announced the acquisition of network security firm ShieldX.

According to Q2 2022 reports, Fortinet, Inc. (NASDAQ:FTNT) edged ahead of its $0.22 EPS estimates after posting an EPS of $0.24, compared to $0.19 in the previous year. The revenue of $1.03 billion also outperformed the $1.027 billion consensus. The bookings rose to $1.38 billion, representing a 42% YoY growth, and billings increased by 36% to $1.3 billion. Additionally, the non-GAAP gross margins were recorded at 76.5% and non-GAAP operating income made a 25.6% leap to $255.4 million. At the end of the quarter, the company had cash and cash equivalents of $1.73 billion, including short-term investments. During the first half of 2022, the company reported an operating cash flow of $719.5 million. Moreover, Fortinet, Inc. (NASDAQ:FTNT) bought back $800 million worth of shares in the quarter and increased the buyback authorization to $1 billion.

On August 4, Barclays analyst Saket Kalia maintained an Overweight rating on Fortinet, Inc. (NASDAQ:FTNT)’s shares with a price target of $77, down from $80. Kalia noted that the company’s earnings beat and billings flow through was expected. However, the bookings growth was lower than expected.

Here is what ClearBridge Investments had to say about the prospects of Fortinet, Inc. (NASDAQ:FTNT) in its Q3 2021 investor letter:

“Performance among our cohort of IT and Internet companies was mixed, with enterprise software makers thriving while more consumer-oriented stocks faced headwinds. Cyber security software maker Fortinet benefited from a heightened awareness of the need to protect against sophisticated attacks. We are attracted to the recurring revenue nature of these software companies that are increasingly delivering their products on a subscription basis through the cloud. Software business models also tend to avoid many of the inflationary issues facing companies with a physical product or service.”