Cisco Systems vs Fortinet Which Should You Buy?
Cisco Systems and Fortinet are two major players in the networking and cybersecurity industries, with both companies offering a range of products and services to meet the evolving needs of businesses in a digital world. Cisco Systems, a global leader in networking equipment, has a long-standing reputation for reliable technology solutions. Fortinet, on the other hand, specializes in cybersecurity solutions, protecting organizations from cyber threats. Investors are constantly comparing and contrasting these two tech giants to determine which stock offers the best investment opportunity in the ever-changing tech landscape.
Cisco Systems or Fortinet?
When comparing Cisco Systems and Fortinet, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Cisco Systems and Fortinet.
Dividend Investors:
Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company.
Cisco Systems has a dividend yield of 2.5%, while Fortinet has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Cisco Systems reports a 5-year dividend growth of 2.87% year and a payout ratio of 69.73%. On the other hand, Fortinet reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.
Value Investors:
Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Cisco Systems P/E ratio at 27.71 and Fortinet's P/E ratio at 44.48. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Cisco Systems P/B ratio is 5.59 while Fortinet's P/B ratio is 51.97.
Growth Investors:
Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Cisco Systems has seen a 5-year revenue growth of 0.13%, while Fortinet's is 2.09%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Cisco Systems's ROE at 20.19% and Fortinet's ROE at 273.48%.
Retail Investors:
Retail investors often consider stock affordability and company familiarity. For example, day low prices are $62.19 for Cisco Systems and $98.05 for Fortinet. Over the past year, Cisco Systems's prices ranged from $44.50 to $66.50, with a yearly change of 49.44%. Fortinet's prices fluctuated between $54.57 and $114.82, with a yearly change of 110.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.
