Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Fortinet Inc., FCFE calculation
US$ in thousands
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
An analysis of the cash flow trends from 2018 to 2022 reveals a consistent expansion in operational cash generation contrasted with significant volatility in the cash available to equity holders.
- Operating Cash Flow Performance
- Net cash provided by operating activities demonstrated a continuous upward trajectory over the five-year period. From 638,900 thousand US dollars in 2018, this figure grew steadily to 1,730,600 thousand US dollars by 2022. This represents a sustained increase in the ability to generate cash from core business operations.
- Free Cash Flow to Equity (FCFE) Trends
- FCFE exhibited a period of growth followed by a sharp peak and subsequent correction. The value increased from 585,900 thousand US dollars in 2018 to 957,800 thousand US dollars in 2020. A substantial surge occurred in 2021, where FCFE reached a peak of 2,190,800 thousand US dollars, before declining to 1,449,400 thousand US dollars in 2022.
- Analysis of Cash Flow Divergence
- A notable divergence between operating cash flow and FCFE occurred in 2021, where FCFE significantly exceeded net cash provided by operating activities. This suggests that non-operational cash inflows, such as new debt issuance, or a significant reduction in capital expenditures occurred during that period. Conversely, in 2022, while operating cash flow continued to rise, FCFE decreased, indicating increased capital investments, debt repayments, or adjustments in working capital that reduced the cash remaining for equity holders.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Price to FCFE Ratio, Current
Fortinet Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 785,196,153 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in thousands) | 1,449,400) |
| FCFE per share | 1.85 |
| Current share price (P) | 66.08 |
| Valuation Ratio | |
| P/FCFE | 35.80 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Accenture PLC | 9.44 |
| Adobe Inc. | 9.27 |
| AppLovin Corp. | 23.19 |
| Cadence Design Systems Inc. | 53.85 |
| Datadog Inc. | 224.73 |
| International Business Machines Corp. | 16.16 |
| Intuit Inc. | 9.20 |
| Microsoft Corp. | 62.20 |
| Oracle Corp. | 21.07 |
| Palantir Technologies Inc. | 177.78 |
| Palo Alto Networks Inc. | 64.95 |
| Salesforce Inc. | 9.24 |
| ServiceNow Inc. | 23.44 |
| Synopsys Inc. | 5.70 |
| Workday Inc. | 17.37 |
| P/FCFE, Sector | |
| Software & Services | 57.99 |
| P/FCFE, Industry | |
| Information Technology | 70.14 |
Based on: 10-K (reporting date: 2022-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Fortinet Inc., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 784,066,289 | 804,077,230 | 815,954,595 | 862,573,610 | 853,168,355 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in thousands)2 | 1,449,400) | 2,190,800) | 957,800) | 715,800) | 585,900) | |
| FCFE per share3 | 1.85 | 2.72 | 1.17 | 0.83 | 0.69 | |
| Share price1, 4 | 58.86 | 64.99 | 34.39 | 21.25 | 17.58 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 31.84 | 23.85 | 29.30 | 25.61 | 25.60 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| Accenture PLC | 17.87 | 25.76 | — | — | — | |
| Adobe Inc. | 21.32 | 34.26 | 41.36 | — | — | |
| AppLovin Corp. | — | 22.51 | — | — | — | |
| Cadence Design Systems Inc. | 33.41 | 36.31 | — | — | — | |
| Datadog Inc. | 69.38 | 202.25 | — | — | — | |
| International Business Machines Corp. | 11.97 | 48.45 | — | — | — | |
| Intuit Inc. | 13.86 | 86.74 | — | — | — | |
| Microsoft Corp. | 36.73 | 42.54 | — | — | — | |
| Oracle Corp. | — | 8.36 | — | — | — | |
| Palantir Technologies Inc. | 96.89 | 198.12 | — | — | — | |
| Palo Alto Networks Inc. | 29.54 | 32.91 | — | — | — | |
| Salesforce Inc. | 16.56 | 49.52 | — | — | — | |
| ServiceNow Inc. | 44.44 | 64.54 | — | — | — | |
| Synopsys Inc. | 33.41 | 40.55 | 45.07 | — | — | |
| Workday Inc. | 49.17 | 40.57 | — | — | — | |
| P/FCFE, Sector | ||||||
| Software & Services | 31.24 | 34.11 | — | — | — | |
| P/FCFE, Industry | ||||||
| Information Technology | 26.68 | 27.39 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
3 2022 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 1,449,400,000 ÷ 784,066,289 = 1.85
4 Closing price as at the filing date of Fortinet Inc. Annual Report.
5 2022 Calculation
P/FCFE = Share price ÷ FCFE per share
= 58.86 ÷ 1.85 = 31.84
6 Click competitor name to see calculations.
The analysis of the Price to Free Cash Flow to Equity (P/FCFE) metric reveals a period of significant expansion in market valuation and underlying cash flow generation from 2018 through 2022. While both share price and FCFE per share exhibited strong growth trajectories during the first four years of the period, the valuation ratio experienced volatility, culminating in a five-year peak in 2022.
- Share Price Trajectory
- A consistent upward trend is observed from 2018 to 2021, with the share price increasing from US$ 17.58 to a peak of US$ 64.99. A moderate correction occurred in 2022, with the price settling at US$ 58.86.
- FCFE per Share Growth
- Free Cash Flow to Equity per share demonstrated steady growth, rising from US$ 0.69 in 2018 to US$ 1.17 in 2020. A substantial acceleration occurred in 2021, where the value reached US$ 2.72, before declining to US$ 1.85 in 2022.
- P/FCFE Ratio Interpretation
- The P/FCFE ratio remained stable at approximately 25.6 between 2018 and 2019, before climbing to 29.30 in 2020. In 2021, the ratio reached its lowest point in the series at 23.85, indicating that the growth in FCFE per share outpaced the increase in share price. However, by 2022, the ratio ascended to its highest level of 31.84, driven by a contraction in FCFE per share relative to the share price.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?