Should You Buy Fortinet Stock Before July 29 Q2 Earnings?

Fortinet (NASDAQ:FTNT) heads into Wednesday's Q2 net study with a grounds fewer cybersecurity companies tin match: 24th consecutive 4th without an net miss. The concern is generating grounds escaped currency flow, and is moving a buyback programme ample capable to relation arsenic a de facto dividend. Here are 3 reasons this cybersecurity elephantine looks appealing up of earnings:

Product Revenue Just Accelerated 41%

Fortinet's Product gross reaccelerated to +41% YoY successful Q1, and billings jumped 31%, signaling the firewall refresh rhythm astir FortiOS 8.0 and the FortiGate G Series is live.

In addition, absorption raised FY26 guidance to $7.71B–$7.87B gross and $3.10–$3.16 successful non-GAAP EPS. The company's Q1 net study drove a +28.17% 30-day determination against the S&P 500's +0.75%, which demonstrates however a beardown study connected Wednesday could elicit a meaningful marketplace reaction.

Fortinet's $10.25 Billion Share Buyback

In Q1 alone, Fortinet repurchased $823 million of stock. These purchases person proven to beryllium good timed, arsenic the banal has since raced forward, and they amusement the business's capableness to instrumentality superior to shareholders.

Today, the institution sits connected a $10.25 billion full stock repurchase authorization aft a $1.0 cardinal committee raise, and produced record escaped currency travel of $1.006 billion (+26.32% YoY) to money it. The company's nett indebtedness to EBITDA sits astatine -0.67, truthful the equilibrium expanse has ample country to money the buybacks directly.

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Fortinet's Valuation Looks Reasonable Compared to Palo Alto

Cybersecurity companies are known for trading astatine precocious multiples, but Fortinet looks reasonably valued compared to peers. The banal trades astatine a forward P/E of 52x against a concern compounding astatine astir 15% YoY gross maturation with a 31.3% operating borderline and a 27.5% nett margin. A competitor, Palo Alto Networks (NASDAQ:PANW), trades astatine a guardant P/E of 78x with a TTM operating borderline of -2.47%.