Fortinet, Inc. (FTNT) vs Microsoft Corporation (MSFT)

Fortinet, Inc. and Microsoft Corporation are both Software Infrastructure companies. Microsoft Corporation is the larger, with a market value of $3.68T against $130.0B — 28.3× the size. Microsoft Corporation trades at the lower P/E: 28.7× against 60.7×. Fortinet, Inc. grew revenue faster over the last twelve months: 18.8% against 17.8%. Microsoft Corporation has the higher net margin (40.3% vs 28.2%) and the higher return on invested capital (23.9% vs 0.00%). Across the 22 metrics below, Fortinet, Inc. leads on 11 and Microsoft Corporation on 11.

Valuation

Metric FTNT MSFT Software Infrastructure median
P/E 60.65 28.69 28.02
P/S 16.89 11.57 3.07
P/B 81.98 8.68 3.36
Price to free cash flow 40.80 57.31 17.12
EV/EBITDA 42.14 19.62 14.91
EV/Sales 16.49 11.46 3.03
Earnings yield 1.65% 3.49% 0.13%
Free cash flow yield 2.45% 1.74% 1.15%

Profitability

Metric FTNT MSFT Software Infrastructure median
Gross margin 80.20% 67.94% 61.23%
Operating margin 32.44% 46.78% 0.00%
Net margin 28.17% 40.31% 0.00%
Free cash flow margin 41.41% 20.19% 1.67%
Return on equity 117.44% 34.04% 0.59%
Return on assets 19.73% 19.42% 0.00%
Return on invested capital 0.00% 23.91% 0.00%

Growth

Metric FTNT MSFT Software Infrastructure median
Revenue growth (TTM) 18.77% 17.79% 13.41%
EPS growth (last fiscal year) 7.08% 31.60% —
Revenue growth, 5-year CAGR 21.25% 14.57% 15.81%
Net income growth, 5-year CAGR 30.56% 16.90% 0.00%

Health

Metric FTNT MSFT Software Infrastructure median
Debt to equity 0.32 0.09 0.06
Current ratio 1.28 1.23 1.55
Net debt to EBITDA (1.02) (0.19) 0.08

Dividend

Metric FTNT MSFT Software Infrastructure median
Dividend yield — 0.71% 1.53%
Payout ratio 0.00 0.27 0.00

Size

Metric FTNT MSFT Software Infrastructure median
Market cap 130.01b 3.68t 835.96m

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