Cybersecurity Sector Ideas

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>>> Fortinet has been growing impressively. The company's 2022 revenue of $4.42 billion was up 32% over the prior year. More importantly, Fortinet's deferred revenue increased at a faster pace of 34% over 2021 to $4.64 billion, while billings also increased by a similar number to $5.6 billion.


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The faster growth in Fortinet's billings and deferred revenue compared with its actual revenue is an indication that the company is building a solid future revenue pipeline. That's not surprising, as customers have ramped up their spending on its offerings. For instance, Fortinet landed 181 deals worth $1 million or more last quarter, up from 122 in the year-ago period. Meanwhile, the number of deals worth $500,000 or more also increased rapidly to 450 from 320 in the prior year.

Fortinet can sustain its impressive growth, as it gets a quarter of its business from the software-defined wide area network (SD-WAN) and operational technology (OT) cybersecurity markets. These are fast-growing niches, as the SD-WAN security space is expected to generate 21.2% annual growth over the next decade, while the OT security market could expand at an annual rate of 15.5% over the next five years.

As a result, Fortinet should be able to deliver robust growth against last year's revenue of $4.4 billion.

It's also worth noting that Fortinet has turned a $1,000 investment into more than $13,500 over the past decade, and the huge addressable opportunity in the cybersecurity market could help it remain a top cybersecurity stock for years to come.

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