FTNT
Fortinet, Inc.
$149.98
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 20.7% above fair value
You pay
$149.98
Bear
$70.03
Fair
$124.27
Bull
$192.05
Bear
$70.03
-53.3%
12% stage 1 growth, 11% discount
Fair
$124.27
-17.1%
20% stage 1 growth, 11% discount
Bull
$192.05
+28.1%
26% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (20% base case)
Terminal Value % of EV
46%
Implied Market Multiple
53.2x
Market is pricing in (growth)
22.0%
vs 19.8% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $118.45 from 68 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $124.27 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions