Fortinet, Inc. (FTNT) vs Texas Instruments Incorporated (TXN): Which Is the Better Buy in 2026?
As of 2026-09-17, FTNT is overvalued at $172, with a DCF intrinsic value of $65 and a margin of safety of -165%. TXN is undervalued at $262, with an intrinsic value of $365 and a margin of safety of 28%. Of the two, TXN has the wider margin of safety.
Rewards
- ★Fortinet, Inc. has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
- ★Gross margin of 80.2% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Fortinet, Inc. scores 86/100 on the Economic Moat Score (Wide Moat), with revenue predictability as the strongest competitive dimension.
- ★Texas Instruments Incorporated has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
- ★Return on equity has consistently exceeded 20% over 4 years, indicating efficient use of shareholder capital.
- ★PEG ratio of 0.94 suggests the stock is undervalued relative to its growth rate — paying less than 1x for each unit of earnings growth.
Risks
- ⚠FCF yield of 1.8% is below 3%, meaning the market is pricing in substantial future growth to justify the current price.
- ⚠Trailing P/E of 60.9x is 53% above the historical average of 39.7x — the stock trades at a premium to its own history.
- ⚠Insiders have sold $36.2M worth of stock in the past 3 months — significant insider liquidation.
- ⚠Buybacks have been poorly timed — 3 out of 4 years involved repurchases at relatively expensive valuations.
- ⚠FCF yield of 1.5% is below 3%, meaning the market is pricing in substantial future growth to justify the current price.
- ⚠Trailing P/E of 39.9x is 47% above the historical average of 27.1x — the stock trades at a premium to its own history.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →What growth rate is the market pricing in at $172?
The market implies +24.1% Owner Earnings growth, below historical trends — potential opportunity.
Standard FCF implies a more demanding +21.3%, reflecting heavy growth investment expected to generate future returns.
What growth rate is the market pricing in at $262?
The market implies +20.0% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +24.8%, reflecting heavy growth investment.
Economic Moat Score
Learn more →Wide moat with strength across all dimensions. Revenue Predictability is the standout factor.
Narrow moat with roic consistency as the key competitive advantage. Improving reinvestment efficiency would strengthen the moat.
Forensic Accounting
Learn more →M-Score Trend
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is optimistic — be cautious and ensure you have a margin of safety"
"Market is pricing this stock without strong emotion in either direction"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: FTNT vs TXN
Is Fortinet, Inc. or Texas Instruments Incorporated more undervalued in 2026?▼
Based on our discounted cash flow model, TXN trades at a 28.2% margin of safety (intrinsic value $365 vs. price $262), compared to FTNT's -165.4% margin of safety (intrinsic $65 vs. $172).
Which stock has a wider economic moat, Fortinet, Inc. or Texas Instruments Incorporated?▼
FTNT scores 86/100 (Wide moat), while TXN scores 48/100 (Narrow moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Which company has better free cash flow, Fortinet, Inc. or Texas Instruments Incorporated?▼
Fortinet, Inc. (FTNT) generates a 1.8% free cash flow yield, compared to Texas Instruments Incorporated's 1.5%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Fortinet, Inc. or Texas Instruments Incorporated?▼
FTNT earns 94.6% ROIC versus TXN's 20.4%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.