Keith Bachman, an analyst from BMO Capital, reiterated the Hold rating on Fortinet (FTNT – Research Report). The associated price target was raised to $122.00.
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Keith Bachman has given his Hold rating due to a combination of factors that reflect both strengths and challenges for Fortinet. The company reported a strong quarter with impressive performance in the firewall market and exceeded expectations in operating margins. However, Bachman expresses concerns about Fortinet’s fiscal year 2025 organic billings guidance, which he finds underwhelming despite expectations for significant refresh activity in the latter half of the year. This raises questions about the level of conservatism in the company’s projections.
Bachman acknowledges Fortinet’s robust portfolio of firewall and security products that can drive long-term revenue. Nonetheless, he is cautious about the growth prospects of the firewall market and the sustainability of services revenue growth. While Fortinet’s valuation is supported by strong free cash flow, one of the highest in its coverage universe, Bachman does not find the valuation particularly attractive at this time, leading to his Hold rating.
In another report released today, Stifel Nicolaus also maintained a Hold rating on the stock with a $115.00 price target.