Fortinet

Methodology

Fortinet's network security appliance and software business generates predictable earnings from recurring subscription and support revenue layered on hardware sales. The integrated security platform creates strong customer retention. This calculation works well given consistent earnings growth from security spending increases and transition to cloud-delivered services.

Methodology

Fortinet typically commands premium PEG ratios reflecting its network security leadership, high renewal rates, and consistent execution. The company's unified platform and competitive pricing support market share gains. PEG appears expensive but reflects sustainable growth from escalating cyber threats and cloud security adoption.

Methodology

Fortinet doesn't pay dividends and generates substantial free cash flow used for share buybacks and strategic investments in security R&D. Management prioritizes reinvestment in product development and opportunistic capital returns. Total return depends on continued security market growth and maintaining competitive positioning against next-generation security platforms.