Head to Head Analysis: Fortinet (FTNT) & Key Tronic (KTCC)

Fortinet (NASDAQ: FTNT) and Key Tronic (NASDAQ:KTCC) are both computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, valuation, analyst recommendations, earnings and risk.

Valuation and Earnings

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This table compares Fortinet and Key Tronic’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fortinet $1.49 billion 6.42 $31.39 million $0.52 109.90
Key Tronic $467.80 million 0.16 $5.61 million $0.51 13.88

Fortinet has higher revenue and earnings than Key Tronic. Key Tronic is trading at a lower price-to-earnings ratio than Fortinet, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

69.5% of Fortinet shares are held by institutional investors. Comparatively, 42.7% of Key Tronic shares are held by institutional investors. 17.0% of Fortinet shares are held by company insiders. Comparatively, 7.2% of Key Tronic shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and target prices for Fortinet and Key Tronic, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fortinet 1 12 11 0 2.42
Key Tronic 0 0 0 0 N/A

Fortinet presently has a consensus price target of $50.23, suggesting a potential downside of 12.11%. Given Fortinet’s higher possible upside, research analysts clearly believe Fortinet is more favorable than Key Tronic.

Profitability

This table compares Fortinet and Key Tronic’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fortinet 2.10% 11.77% 4.20%
Key Tronic 0.55% 3.13% 1.57%

Risk and Volatility

Fortinet has a beta of 0.71, meaning that its stock price is 29% less volatile than the S&P 500. Comparatively, Key Tronic has a beta of 0.09, meaning that its stock price is 91% less volatile than the S&P 500.

Summary

Fortinet beats Key Tronic on 13 of the 13 factors compared between the two stocks.

Fortinet Company Profile

Fortinet, Inc. is a network security company. The Company provides cyber security solutions to a range of enterprises, service providers and government organizations across the world. Its network security solution consists of FortiGate physical, virtual machine and cloud platforms, which provide integrated security and networking functions to protect data, applications and users from network-and content-level security threats. The Company’s product offerings consist of its FortiGate product family, along with its FortiManager central management and FortiAnalyzer central logging and reporting product families. Its cybersecurity platform includes a range of products, which include its FortiMail e-mail security, FortiSandbox advanced threat protection (ATP), FortiWeb Web application firewall, FortiDDos and FortiDB database security appliances, as well as its FortiClient endpoint security software, FortiAP secure wireless access points and FortiSwitch secure switch connectivity products.

Key Tronic Company Profile

Key Tronic Corporation, doing business as KeyTronicEMS Co., provides electronic manufacturing services (EMS) and solutions to original equipment manufacturers in the United States and internationally. The company offers integrated electronic and mechanical engineering, assembly, sourcing and procurement, logistics, and new product testing services. Its services include product design; surface mount technologies and pin through hole capability for printed circuit board assembly; tool making; precision plastic molding; sheet metal fabrication; liquid injection molding; complex assembly; automated tape winding; prototype design; and full product assembly services. The company also manufactures keyboards and other input devices. It markets its products and services primarily through field sales people and distributors. Key Tronic Corporation was founded in 1969 and is headquartered in Spokane Valley, Washington.

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