Stock of the Week: Fortinet - Keeping the Lights on in a Dark Market
How the cybersecurity leader is continuing its growth path
Welcome to “Stock of the Week”, a recurring series focused on companies experiencing meaningful news flow or changes in their investment case. The objective is not to react to headlines but to understand what is happening beneath the surface and whether recent developments materially affect the long-term investment thesis.
Each article applies the Quality Stocks Investment Framework to assess business quality, return potential and execution, in order to determine whether the stock is Attractive, Conditional, or Unattractive at the current price. A standardized one-pager accompanies each edition to make the decision process clear and easy to follow.
For paid subscribers, Stock of the Week goes a step further by opening up the full reasoning behind the investment thesis and decision process:
Detailed TSR calculations, including all underlying assumptions. This allows investors to understand what must go right for the investment to deliver acceptable returns and to stress-test their own expectations against explicit inputs
My analysis beyond the overall verdict. This provides a deeper insight, enabling investors to form an independent view rather than relying solely on a conclusion
This week’s spotlight is on Fortinet. In a week where the broader tech sector felt like it was navigating through a thick fog of uncertainty, Fortinet emerged as a steady signal with a strong Q4 earnings report, with a massive 40% surge in Unified SASE billings and a fresh $1 billion added to its buyback program. Let’s dive in!
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One Pager
The stock at a glance
Recent news
Quarterly billings grew 18% to $2.37B, surpassing the high end of management’s own guidance and beating analyst consensus of approximately $2.25B
The company ended 2025 with $2.21B in Free Cash Flow
Unified SASE billings surged 40% YoY, signaling that Fortinet’s pivot from pure hardware firewalls to cloud-native security software is successfully entering a hyper-growth phase
CEO Ken Xie highlighted that “Secure Networking” is expected to surpass traditional networking by the end of 2026, driven by customers consolidating their infrastructure into Fortinet’s unified platform
Product revenue accelerated to 20% growth in Q4, a sharp recovery from the firewall digestion period of 2024, as a massive hardware refresh cycle began to take hold
Fortinet announced a $1B increase to its share buyback program
Recent analyst recommendation updates
February, 06. Citigroup. Hold. $85 —> $90
February, 06. RBC. Hold. $85 —> $90
February, 06. Deutsche Bank. Hold. $75 —> $85
February, 06. Rosenblatt. Buy. $100 —> $105
February, 06. Jefferies. Hold. $80 —> $90
February, 06. JP Morgan. Sell. $72 —> $73
To go beyond the initial assessment, paid subscribers unlock the detailed TSR calculation with underlying assumptions and my analysis of the situation, providing deeper insight into how recent developments affect risks, opportunities and the overall verdict.
