Critical Analysis: Black Knight Financial Services (BKFS) versus Fortinet (FTNT)
Black Knight Financial Services (NYSE: BKFS) and Fortinet (NASDAQ:FTNT) are both mid-cap technology companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, earnings, profitability, analyst recommendations, risk and institutional ownership.
Insider and Institutional Ownership
44.7% of Black Knight Financial Services shares are held by institutional investors. Comparatively, 69.2% of Fortinet shares are held by institutional investors. 30.8% of Black Knight Financial Services shares are held by company insiders. Comparatively, 16.4% of Fortinet shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This is a summary of recent ratings and price targets for Black Knight Financial Services and Fortinet, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Black Knight Financial Services||0||1||6||0||2.86|
Black Knight Financial Services currently has a consensus price target of $46.50, indicating a potential upside of 8.01%. Fortinet has a consensus price target of $43.59, indicating a potential upside of 12.51%. Given Fortinet’s higher possible upside, analysts clearly believe Fortinet is more favorable than Black Knight Financial Services.
Earnings & Valuation
This table compares Black Knight Financial Services and Fortinet’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Black Knight Financial Services||$1.05 billion||2.74||$356.90 million||$0.60||71.75|
|Fortinet||$1.38 billion||4.94||$142.32 million||$0.48||80.71|
Black Knight Financial Services has higher revenue, but lower earnings than Fortinet. Black Knight Financial Services is trading at a lower price-to-earnings ratio than Fortinet, indicating that it is currently the more affordable of the two stocks.
This table compares Black Knight Financial Services and Fortinet’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Black Knight Financial Services||11.14%||3.77%||3.14%|
Risk & Volatility
Black Knight Financial Services has a beta of 0.74, meaning that its share price is 26% less volatile than the S&P 500. Comparatively, Fortinet has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.
Fortinet beats Black Knight Financial Services on 8 of the 14 factors compared between the two stocks.
About Black Knight Financial Services
Black Knight Financial Services, Inc. is a holding company. The Company, through its subsidiaries, provides integrated technology, workflow automation, and data and analytics to the mortgage and real estate industries. The Company’s segments include Technology, and Data and Analytics. The Company’s Technology segment offers software and hosting solutions that support loan servicing, loan origination and settlement services. The Technology segment provides applications and services, such as servicing technology and origination technology. Its Data and Analytics segment offers data and analytics solutions to the mortgage, real estate and capital markets industries. These solutions include property ownership data, lien data, servicing data, automated valuation models, collateral risk scores, prepayment and default models, lead generation and other data solutions.
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.
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