PANW - Fortinet: Potential SASE And AI Gains And Related Indicators For Earnings Call

2024-04-27 10:03:52 ET

Summary

• Fortinet stock seems to be moving sideways, but the upcoming first quarter 2024 financial results are to be released around May 2 should trigger some action.
• The company is well positioned in the SASE market, with the pipeline also soaring, but, competition from companies like Palo Alto Networks and Juniper Networks could impact the growth potential.
• As for AI, it has not yet benefited from artificial intelligence-specific networking-related gains as peers, but there are opportunities as summarized in the AI opportunities table.
• This is the reason it is important to be vigilant during the forthcoming earnings call.
• Indicators to look for include backlog progression, SASE pipeline, billings growth, and AI pipeline.

Since my last piece on Fortinet on March 12, the stock has lost around 8% and was trading at around $64 at the time of writing. At that time, I had a Hold position based on the company adapting to the new cybersecurity realities amid opportunities in SASE (Secure Access Secure Edge). Since then some Wall Street analysts have expressed optimism based on potential uptake for the company’s FortiSASE product amid an acceleration in IT spending this year after 2023's slump....

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