Canaccord Genuity Morning Coffee on Fortinet (FTNT) and IBM (IBM): How Fortinet
FTNT Hot Sheet
Rating Summary:9 Buy, 11 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 19 | Down: 16 | New: 82
Canaccord Genuity Morning Coffee on Fortinet (Nasdaq: FTNT) and IBM (NYSE: IBM): How Fortinet...
The network-security company surged after Bloomberg reported late Friday that Big Blue is interested in a possible takeover. Neither Fortinet nor Big Blue were willing to comment on the subject, but the rumour does seem possible in the context of recent buyout activity. The security industry has undergone a wave of consolidation of late, with Hewlett- Packard (NYSE: HPQ) striking a deal in September to acquire ArcSight (Nasdaq: ARST), and Intel (Nasdaq: INTC) announcing its purchase of McAfee (NYSE: MFE) in August. The deals come as technology companies seek to address a growing number of threats that are emerging as the way people use computers changes. William Blair & Co. said in a note Monday that Fortinet could be an attractive acquisition target because of its broad set of security capabilities, rapid growth and strong hardware capabilities. “Given the scarcity of remaining high-quality security assets and the importance of security as a differentiating feature for large systems integrators, we believe acquisition multiples paid for remaining assets should remain relatively high,” William Blair said. Separately, JMP Securities estimated that premium could be anywhere between 20% and 50%, but said there would be have to be multiple bidders to push it toward the higher end of that range.
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The network-security company surged after Bloomberg reported late Friday that Big Blue is interested in a possible takeover. Neither Fortinet nor Big Blue were willing to comment on the subject, but the rumour does seem possible in the context of recent buyout activity. The security industry has undergone a wave of consolidation of late, with Hewlett- Packard (NYSE: HPQ) striking a deal in September to acquire ArcSight (Nasdaq: ARST), and Intel (Nasdaq: INTC) announcing its purchase of McAfee (NYSE: MFE) in August. The deals come as technology companies seek to address a growing number of threats that are emerging as the way people use computers changes. William Blair & Co. said in a note Monday that Fortinet could be an attractive acquisition target because of its broad set of security capabilities, rapid growth and strong hardware capabilities. “Given the scarcity of remaining high-quality security assets and the importance of security as a differentiating feature for large systems integrators, we believe acquisition multiples paid for remaining assets should remain relatively high,” William Blair said. Separately, JMP Securities estimated that premium could be anywhere between 20% and 50%, but said there would be have to be multiple bidders to push it toward the higher end of that range.
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