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Fri, Feb. 5, 11:01 AM
- A long list of enterprise software and security tech names are off sharply after business intelligence/analytics software upstart Tableau (down 45.3%) reported slower-than-expected license revenue growth and issued below-consensus Q1/2016 guidance.
- Also possibly weighing: LinkedIn (down 39.6%), which derives a large % of its revenue from cloud-based recruiting and sales tools for enterprises, issued weak Q1/2016 guidance.
- Given the magnitude of the drops, margin calls and forced selling by funds could be playing a big role. The Nasdaq is down 2.2%.
- Tableau suggested its growth slowdown has to do with softening IT spend and a need to improve sales productivity, but analysts have raised questions about competition from the likes of Microsoft, Amazon, and Qlik. LinkedIn forecast a growth slowdown for its field sales hiring solutions business, while blaming European/Asian macro pressures. The company also noted its display ad business continues declining amid weak industry growth.
- Major enterprise software decliners include Splunk (SPLK -23.7%), Workday (WDAY -15.1%), Adobe (ADBE -7%), Zendesk (ZEN -15.2%), ServiceNow (NOW -13.6%), NetSuite (N -12.4%), Salesforce (CRM -11.2%), Paycom (PAYC -10.6%), Ellie Mae (ELLI -11.5%), Cornerstone OnDemand (CSOD -7.8%), Veeva (VEEV -7.7%), Ultimate Software (ULTI -9%), Luxoft (LXFT -7.5%), Manhattan Associates (MANH -8.5%), Box (BOX -6.6%), Guidewire (GWRE -13.6%), Demandware (DWRE -9.3%), Hortonworks (HDP -9.7%), and Tableau rival Qlik (QLIK -16.6%). The casualty list includes many cloud software firms, as well as several analytics software plays. Previously covered: New Relic, Atlassian.
- Major decliners among security tech firms: Palo Alto Networks (PANW -12%), FireEye (FEYE -8.9%), Rapid7 (RPD -8.6%), CyberArk (CYBR -8.3%), Proofpoint (PFPT -8%), Imperva (IMPV -8.3%), Fortinet (FTNT -6.9%), and Vasco (VDSI -5.1%). The selloff comes in spite of an FQ3 beat and in-line FQ4 guidance from Symantec, which has been losing share to various upstarts.
Thu, Jan. 28, 5:38 PM
Thu, Jan. 28, 5:06 PM
- With expectations low going into earnings, Fortinet (NASDAQ:FTNT) has surged to $29.00 after hours after posting nearly in-line Q4 results and providing healthy 2016 guidance in its earnings slides (.pdf) - revenue of $1.25B-$1.26B (+24% Y/Y) and EPS of $0.67-$0.69 vs. a consensus of $1.24B and $0.68.
- Q1 guidance is light: Revenue of $270M-$275M and EPS of $0.08-$0.09 vs. a consensus of $277.6M and $0.13.
- Fortinet has also announced a new $200M buyback - it's good for repurchasing 4% of shares at current levels. The buyback replaces a prior authorization through which $137.5M was spent to buy back 5.5M shares. $60M was spent on buybacks in Q4.
- Billings: Q4 billings totaled $380.9M, up 35% Y/Y, above revenue of $296.5M, and topping guidance of $364M-$369M. Q1 billings guidance is at $315M-$322M (+25% Y/Y), and full-year guidance at $1.505B-$1.52B (+23%). Fortinet has a history of issuing conservative billings guidance. Billings growth led the deferred revenue balance to rise 42% Y/Y in Q4 to $791.3M.
- Fortinet's Q4 results, earnings release
Tue, Jan. 26, 8:38 AM
- Stating Q4 channel checks point to a slowdown in momentum, Deutsche's Imtiaz Koujalgi has downgraded Fortinet (NASDAQ:FTNT) to Hold ahead of the unified threat management/next-gen firewall appliance vendor's Thursday afternoon Q4 report. His target has been cut by $15 to $34.
- FTNT -2.1% premarket to $26.65. Piper downgraded Fortinet last week, while citing a soft Q4 reseller survey, a shift in IT spending priorities, growing price pressure, and tough comps.
- Shares now go for just 3.9x the midpoint of a 2015 billings guidance range of $1.215B-$1.22B.
Wed, Jan. 20, 9:13 AM
Wed, Jan. 20, 8:40 AM
- Piper's Andrew Nowinski has downgraded Fortinet (NASDAQ:FTNT) to Neutral ahead of its Jan. 28 Q4 report, and cut his target by $20 to $30.
- Nowinski: "Our downgrade is based on a number of factors, including waning demand trends highlighted in our 4Q15 reseller survey, a shift in spending priorities noted in our 2016 CIO survey, increasing pricing pressure and difficult comparisons. Despite trading at a modest discount to peers, we believe Fortinet could struggle to exceed expectations for the aforementioned reasons and therefore we believe the current valuation appropriately balances the risk/reward."
- Shares have dropped to $24.56 premarket on a morning Nasdaq futures are down 1.9%. They also fell hard yesterday.
Tue, Jan. 19, 4:20 PM
- Though the Nasdaq fell just 0.3%, a healthy number of beaten-up tech names tumbled to new 52-week lows today, often on strong volume. Margin calls, panic selling, and fund liquidations are on the list of potential culprits.
- The casualty list once more includes action camera vendor GoPro (GPRO -7.8%) and video processor supplier Ambarella (AMBA -6.3%). It also features threat-prevention tech provider FireEye (FEYE -6.8%), virtualization software giant VMware (VMW -6%), and driver-assistance system provider Mobileye (MBLY -5.4%).
- The list also features unified threat management appliance vendor Fortinet (FTNT -6.4%), microcontroller maker Cypress Semi (CY -6.1%), card-reader/payments provider Square (SQ -7.8%), security software/services provider Rapid7 (RPD -9.7%), and enterprise cloud-storage/file-sharing service provider Box (BOX -7.7%).
- EMC (EMC -2.6%), still set to be acquired by Dell (with part of the payout consisting of a VMware tracking stock), felt the effects of VMware's selloff. Mobileye saw Citron Research take another shot via Twitter. "$MBLY CItron not making the $GPRO mistake, stock is still overvalued as a teenager. At $10 it is still an EXPENSIVE $1.8 bil company."
- Square, meanwhile, is now less than 6% above its $9 IPO price, and 15% below a post-IPO opening trade of $11.20. Rapid7 is 11% below its $16 IPO price, and 47% below an opening trade of $26.75.
- Also falling hard today: Solar stocks, Twitter
Nov. 5, 2015, 12:47 PM
- Fortinet (FTNT -4.2%), Barracuda (CUDA -3.9%), Vasco (VDSI -1.9%), Proofpoint (PFPT -4.6%), and KEYW (KEYW -6.3%) have joined the ranks of enterprise security tech firms selling off in the wake of FireEye's Q3 revenue/billings miss, soft Q4 sales guidance, and full-year billings guidance cut.
- Other decliners include Palo Alto Networks, CyberArk, and Rapid7. FireEye itself is down 23%.
- Also: PC/mobile security software firm AVG is down 17.7% after missing Q3 estimates and providing light Q4 guidance. Symantec is up slightly following an FQ2 EPS beat.
- The PureFunds ISE Cyber Security ETF (HACK -3.1%) has fallen below $27. CyberArk reports after the bell.
- Update: FBR's Daniel Ives is defending the group. "Importantly, we note that nearly every major cybersecurity player (Check Point, Imperva, Proofpoint, Palo Alto, Fortinet) recently has delivered strong results across the board with a healthy outlook ... We continue to strongly believe that FireEye's issues are much more company-specific as DeWalt & Co. are dealing with a plethora of execution/product headaches in the field, which are major overhangs on the FireEye story heading into 2016. We continue to see white-hot cybersecurity spending, which we view as a 30%+ growth area in a 2%–3% overall IT landscape as the threat landscape escalates. We would be strong buyers of the cybersecurity basket, with PANW, PFPT, and CHKP front and center."
Oct. 23, 2015, 9:14 AM
Oct. 22, 2015, 5:56 PM
- Though Fortinet (NASDAQ:FTNT) beat Q3 estimates, it has guided in its earnings slides (.pdf) for Q4 revenue of $293M-$298M (+32% Y/Y at the midpoint) and EPS of $0.18-$0.19 vs. a consensus of $295.4M and $0.21. Expectations were high following July's strong results/guidance.
- Q3 billings totaled totaled $299.6M, +41% Y/Y, above revenue of $260.1M, and above guidance of $285M-$295M. Full-year billings guidance has been slightly upped to $1.215B-$1.22B (+36% at the midpoint) from $1.2B-$1.21B. At the midpoint, Q4 billings guidance of $364M-$369M implies a slowdown in growth to 30%.
- Billings growth led Q3 free cash flow to total $51.7M (well above net income of $24.1M), and the deferred revenue balance to rise 41% Y/Y to $706.9M.
- Fortinet has fallen to $37.95 after hours. Rival Palo Alto Networks (NYSE:PANW), which is also dealing with high expectations, is down 3.3%. FireEye (NASDAQ:FEYE) is down 2%, and CyberArk (NASDAQ:CYBR) down 1.8%.
- Fortinet's Q3 results, PR
Oct. 21, 2015, 12:34 PM
- Several security tech plays, including ones that were tech sector darlings earlier this year as a torrent of hacking incidents led corporate cybersecurity spend to jump, are selling off on a quiet day for equities.
- Major decliners include Palo Alto Networks (PANW -4%), FireEye (FEYE -4.9%), Fortinet (FTNT -4.3%), CyberArk (CYBR -4.8%), Imperva (IMPV -5.3%), Proofpoint (PFPT -3.9%), Qualys (QLYS -2.8%), and Rapid7 (RPD -6.8%).
- No major news has arrived to trigger a selloff. Meanwhile, hacking-related stories have continued producing ink in recent weeks. Notable ones: China is reportedly continuing hacking attacks on U.S. firms in spite of a pact that banned government spying on companies; authorities are probing a potential Russian hack of Dow Jones; and ISIS has reportedly tried (without much success) to hack the U.S. electrical grid.
- The PureFunds ISE Cyber Security ETF (HACK -1.6%) is down 24% from a June peak of $33.91. YTD, it's only down modestly.
- Proofpoint reports earnings after the close, and Fortinet tomorrow afternoon. Qualys reports on Nov. 2, FireEye on Nov. 4,, CyberArk on Nov. 5,, and Rapid7 on Nov. 12,
- Update: One potential culprit: Server virtualization software leader VMware is cratering due to its soft Q4/2016 guidance (partly blamed on cloud adoption). A smattering of other high-beta enterprise tech names are also selling off.
Aug. 6, 2015, 3:56 PM
- Security tech names are among the big decliners (HACK -2.7%) on a day the Nasdaq is off 1.6%. Various other high-beta tech names are also hard-hit.
- Major decliners include Palo Alto Networks (PANW -8.1%), Fortinet (FTNT -4.5%), AVG (AVG -8.1%), Proofpoint (PFPT -4.1%), and newly-public incident-detection/threat-response software firm Rapid7 (RPD -5.7%). Qualys is down 13.5% today after filing its Q2 10-Q.
- Rapid7 is now down 25% from its July 17 opening trade of $26.75, albeit still up 25% from its $16 IPO price. AVG is adding to the 2.5% decline seen yesterday after the company posted a slight Q2 EPS beat, hiked full-year revenue guidance by $10M to $420M-$440M, and reiterated EPS guidance of $1.80-$1.90.
- An afternoon report that the Pentagon has been the victim of a "sophisticated cyberattack" launched by Russia hasn't done much to lift the group. NBC News reports the attack "relied on some kind of automated system that rapidly gathered massive amounts of data and within a minute distributed all the information to thousands of accounts on the Internet." Officials believe it to be "the work of a state actor."
Jul. 23, 2015, 11:27 AM
- As was the case 3 months ago, security tech plays are up strongly (HACK +3.6%) after Fortinet (FTNT +12%) beat estimates, reported strong billings, and delivered above-consensus top-line guidance. The Nasdaq is up 0.3%.
- In addition to FireEye, Palo Alto Networks, and CyberArk (previously covered), gainers include Barracuda Networks (CUDA +6.4%), KEYW Holding (KEYW +4.5%), Symantec (SYMC +1.9%), Imperva (IMPV +7.6%), Proofpoint (PFPT +3.6%), Vasco (VDSI +4.5%), AVG (AVG +3.1%), and Qualys (QLYS +5.7%). AVG is benefiting a bullish JPMorgan coverage launch; Proofpoint reports after the close.
- JPMorgan's Sterling Auty has upgraded Fortinet to Overweight, and a slew of firms have hiked their targets. Auty argues Fortinet's numbers suggest its efforts to grow its high-end presence (aided by major sales investments in recent years), and forecasts free cash flow will rise 43% this year.
- On Fortinet's earnings call (transcript), CFO Drew Del Matto mentioned $100K+ deals rose 53% Y/Y and $1M+ deal 133% (compares with 40% total billings growth). He also mentioned the company's high-end FortiGate UTM/next-gen firewall appliances made up 45% of billings (a new high), and that U.S. enterprise sales (benefiting from strong cybersecurity spend) rose 90%. Major deals were struck with "two of the most recognizable technology brands in the world," as well as two large i-banks.
Jul. 23, 2015, 9:15 AM
Jul. 22, 2015, 5:41 PM
Jul. 22, 2015, 5:17 PM
- Fortinet (NASDAQ:FTNT) has followed up on its Q2 beat by guiding in its earnings slides (.pdf) for 2015 revenue of $1B-$1.01B and EPS of $0.51-$0.52. The latter (pressured by heavy spending) is only in-line with a $0.51 consensus, but the former is soundly above a $943M consensus.
- Likewise, Q3 guidance is for revenue of $255M-$260M and EPS of $0.12 vs. a consensus of $235.3M and $0.14.
- Q2 billings totaled $297.2M, +40% Y/Y, above guidance of $263M-$268M and well above revenue of $239.8M (+30%). Q3 billings guidance (possibly conservative, given Fortinet's history) is at $285M-$295M (+36%), and full-year guidance at $1.2B-$1.21B (+34%). Billings growth led the deferred revenue balance to rise 37% Y/Y to $657.6M.
- Shares have jumped to $46.50 AH. Security tech peers are also up: FireEye (NASDAQ:FEYE) +2.5%, Palo Alto Networks (NYSE:PANW) +1.4%, CyberArk (NASDAQ:CYBR) +1.7%. Check Point provided strong numbers earlier today.
- Fortinet's Q2 results, PR
Fortinet Inc is provider of network security solutions that are designed to address the fundamental problems of an increasingly bandwidth-intensive network environment and a more sophisticated information technology threat landscape.
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