3 Key Reasons to Buy Fortinet Stock Beyond its 11% Year-to-Date Rise

Core Viewpoint - Fortinet (FTNT) has demonstrated strong performance in 2025, with a year-to-date (YTD) share price increase of 10.6%, significantly outperforming the S&P 500 index and the Zacks Computer and Technology sector, which saw declines of 0.4% and 1.7% respectively [1][2]. Group 1: Financial Performance - Total revenues for Q1 2025 increased by 14% year over year to $1.54 billion, with product revenues reaching$ 459 million, up 12% year over year [6]. - Total billings grew by 14% year over year to $1.6 billion, driven by unified SASE and AI-driven SecOps, which contributed 18% and 29% growth respectively [7]. - Gross margin expanded by 380 basis points to 81.9%, and operating margin reached a record 34.2% in Q1 2025 [7]. - Fortinet added over 6,300 new customers during the quarter, marking a 14% increase from the previous year [7]. Group 2: Competitive Positioning - Fortinet differentiates itself in the competitive cybersecurity market through its unified FortiOS platform, which integrates various security solutions, leading to 18% growth in SASE billings and 26% growth in SASE ARR in Q1 2025 [10]. - The company holds over 500 issued and pending AI patents, more than any competitor, and has integrated AI into multiple products, enhancing its market position in AI and firewall solutions [11]. - The introduction of the FortiGate 700G firewall, which offers up to 10x performance gains over competitors, strengthens Fortinet's competitive edge in secure networking [12]. Group 3: Future Outlook - Fortinet anticipates Q2 2025 revenues between$ 1.59 billion and $1.65 billion, indicating a growth of 13% at the midpoint, with non-GAAP earnings per share expected in the range of 58-60 cents [13]. - The Zacks Consensus Estimate for Q2 2025 revenues is$ 1.62 billion, suggesting a year-over-year growth of 12.96% [14]. - Fortinet's Price/Book ratio of 40.72X, while above the industry average, is justified by its strong market position and integrated platform strategy, signaling long-term growth potential [15]. Group 4: Investment Recommendation - Fortinet's strong execution and focus on long-term growth, alongside new product innovations, position it as a compelling investment opportunity [17]. - The company maintains a Zacks Rank 2 (Buy) and a Growth Score of A, indicating a favorable investment outlook [18].