By Mackenzie Tatananni

Fortinet was on course for its best day in nearly a year on Friday after one analyst moved off the sidelines, arguing that negative attitudes around the cybersecurity stock are largely unfounded.

TD Cowen analyst Shaul Eyal raised his rating on the shares to Buy from Hold with a $100 price target. Fortinet rose 6.6% to $82.71, putting it on pace for its largest same-day percentage increase since a 13% jump last April, according to Dow Jones Market Data. The tech-heavy Nasdaq Composite was up 0.6%.

"It ain't that bleak out there," Eyal quipped in the note. His endorsement comes as investors fret that rising memory prices will weigh on Fortinet's margins and sales of its application-specific integrated circuits. Shares have been further beaten down by generally lukewarm sentiment around software stocks.

Fortinet may have fallen out of favor with some investors, but Eyal sees a "stable entry point" as the stock trades below the middle of its 52-week range. The analyst believes the company could report 2026 billings and revenue above Cowen's own estimates, which could drive the stock higher.

Billings and revenue are expected to rise 11.6% and 13.3% year over year, respectively, though billings estimates could be revised higher "on stable spending, as AI is not eating security software but rather augmenting it," Eyal wrote.

What's more, a recent survey from Cowen indicates generative AI could be a boon to the company's core businesses. Network security remains "a top budget priority, cited by the majority of respondents," Eyal wrote. As customers shift to hybrid-cloud platforms, Cowen expects more investments in this area.

The narrative of "AI eating software" cropped up in late 2025, suggesting the emergent technology was rapidly replacing and automating tasks traditionally handled by software applications.

These worries haven't dissipated, but security stocks like Fortinet are more insulated than most, "and could, in fact, benefit from increased gen-AI driven concerns," Eyal wrote.

Another trend instilling fear in the market: rising memory prices, which are expected to eat away at Fortinet's profits. These concerns are also "overblown," Eyal asserted. He believes the company will remain competitive, as its proprietary ASIC chips drive an overall lower total cost of ownership by consolidating network and security functions into one platform.

Not everyone is as enthusiastic. Oppenheimer analysts maintained a Perform rating on the shares in a research note Friday, pointing to waning refresh potential in 2026.

The firm expects lower product and services revenue growth in the coming year. Services revenue, in particular, should decelerate through the first half of 2026 before accelerating in the second half of the year, analysts said.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

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January 23, 2026 11:45 ET (16:45 GMT)

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