Fortinet shares surge despite KeyBanc's cautious bookings outlook
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Fortinet (NASDAQ:FTNT) shares climbed as much as 14% in pre-market trading Wednesday following the security technology company's better-than-expected fourth-quarter earnings and outlook.
However, that performance wasn't enough for KeyBanc analyst Michael Turits, who cut his rating on Fortinet's (FTNT) stock due to its sales just missing estimates, and concerns about the growth rate of the company's billings. Turits lowered his view on Fortinet (FTNT) to sector perform, or the equivalent of neutral, from outperform, and left no price target on the company's stock.
Late Tuesday, Fortinet (FTNT) said that for its fiscal first quarter it expects earnings, excluding one-time items, to be between 27 cents and 29 cents a share, on revenue in a range of $1.18B to $1.22B. The company also forecast billings for the quarter to be between $1.415B and $1.465B.
Turits said Fortinet's (FTNT) outlook suggests its bookings growth is "slowing more rapidly than we expected." Fortinet said its fourth-quarter bookings rose almost 32% from a year ago, but its current outlook implies that first-quarter bookings will rise less than 20% on a year-over-year basis.
For its fourth quarter, Fortinet (FTNT) reported earnings excluding one-time items of 44 cents a share, on $1.28B in sales, while analysts had forecast the company to earn 39 cents a share on revenue of $1.3B.
Along with Fortinet (FTNT), another security technology company, Tenable (TENB), saw its shares climb almost 5% following its upbeat quarterly report and outlook.