Fortinet Inc (FTNT), Sourcefire, Inc. (FIRE): Protecting Ourselves From China’s Hackers

The company’s top line has been growing steadily for a decade. After years of red ink, Sourcefire, Inc. (NASDAQ:FIRE) turned profitable in 2009 and has made money every year since. The company’s first quarter sales were up year over year, but, like Radware, were down sequentially. Its shares dipped on the news, but haven’t been as badly impacted. Regardless, it is a good option for growth investors.

A Bigger Player

Fortinet Inc (NASDAQ:FTNT), with a $3 billion market cap, is almost twice the size of Sourcefire, Inc. (NASDAQ:FIRE) and around five times as large as Radware. The company’s lead products is FortiGate and a collection of management tools around that product. Essentially, it is an integrated portfolio of protection tools in a single package. That includes firewall, virtual private network, antivirus, intrusion prevention, web filtering, and antispam tools, among others.

Fortinet Inc (NASDAQ:FTNT)’s top line has marched steadily higher over the last few years, but earnings have been relatively stagnant. That said, the company’s bottom line is solidly in the black. Like Sourcefire, Inc. (NASDAQ:FIRE), Fortinet’s top line was up year over year, but down sequentially. That’s led to a lower share price and a potential buying opportunity for growth investors with a long-term view.

Across the Industry

The first quarter sales drop is clearly an industry-wide issue. However, the cyber threat certainly isn’t abating. In fact, it’s only likely to get worse. While these companies will always have to spend heavily on research and development to keep up with the hackers, their top and bottom lines should head higher over time, as well. Radware has taken the biggest hit recently, which means it has the most turnaround potential. Fortinet Inc (NASDAQ:FTNT), being the largest of the trio, may prove a less volatile investment over time.

Reuben Brewer has no position in any stocks mentioned. The Motley Fool recommends Sourcefire, Inc. (NASDAQ:FIRE). Reuben is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article Protecting Ourselves From China’s Hackers originally appeared on Fool.com and is written by Reuben Brewer.

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