Zscaler vs Fortinet Which Is a Smarter Choice?

Zscaler and Fortinet are two prominent players in the cybersecurity industry, both offering solutions to protect organizations from cyber threats. As the demand for cybersecurity continues to rise, investors are closely monitoring the performance of these two companies. Zscaler, known for its cloud-based security services, has shown impressive growth in recent years, while Fortinet, with its comprehensive network security solutions, has also gained significant market share. Investors are weighing the strengths and weaknesses of both stocks to make informed decisions about their investment choices.

Zscaler or Fortinet?

When comparing Zscaler 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 Zscaler 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. Zscaler has a dividend yield of -%, while Fortinet has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Zscaler reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. 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 Zscaler P/E ratio at -1936.97 and Fortinet's P/E ratio at 46.91. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Zscaler P/B ratio is 18.71 while Fortinet's P/B ratio is 54.80.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Zscaler has seen a 5-year revenue growth of 4.91%, while Fortinet's is 2.09%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Zscaler's ROE at -1.15% and Fortinet's ROE at 273.48%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $189.58 for Zscaler and $103.72 for Fortinet. Over the past year, Zscaler's prices ranged from $153.45 to $217.84, with a yearly change of 41.96%. 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.