Fortrea (NASDAQ:FTRE) Shares Gap Up After Better-Than-Expected Earnings

Key Points

• Shares jumped ~17.2% after Fortrea reported a quarterly EPS of $0.16 versus consensus $0.03 and revenue of $636.5M versus expected $627.42M, opening at $13.97 after closing at $12.25.
• Analysts are mixed with a consensus rating of Hold and a $16.05 consensus price target, while individual targets range from $11 to $25 and ratings split into 5 Buy, 5 Hold and 1 Sell.
• Insiders have reduced holdings (CFO Jill G. Mcconnell sold 5,061 shares) and insiders now own 0.38% of stock, while several institutions have recently added or increased positions in the company.

Fortrea Holdings Inc. (NASDAQ:FTRE - Get Free Report) gapped up prior to trading on Tuesday after the company announced better than expected quarterly earnings. The stock had previously closed at $12.25, but opened at $13.97. Fortrea shares last traded at $14.3420, with a volume of 643,904 shares trading hands.

The company reported $0.16 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.03 by $0.13. The business had revenue of $636.50 million during the quarter, compared to analysts' expectations of $627.42 million. Fortrea had a negative net margin of 36.21% and a positive return on equity of 6.23%.

Wall Street Analyst Weigh In

FTRE has been the subject of a number of research analyst reports. Mizuho set a $15.00 price target on shares of Fortrea in a report on Friday, January 9th. Barclays decreased their price target on shares of Fortrea from $12.00 to $11.00 and set an "equal weight" rating for the company in a report on Tuesday, April 14th. Evercore set a $25.00 price target on shares of Fortrea and gave the stock an "outperform" rating in a report on Tuesday, January 6th. Truist Financial set a $22.00 target price on shares of Fortrea and gave the stock a "buy" rating in a report on Thursday, January 8th. Finally, Weiss Ratings reissued a "sell (d-)" rating on shares of Fortrea in a report on Tuesday, April 21st. Five equities research analysts have rated the stock with a Buy rating, five have assigned a Hold rating and one has issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus price target of $16.05.

Insider Activity

In related news, CFO Jill G. Mcconnell sold 5,061 shares of the firm's stock in a transaction on Tuesday, March 10th. The shares were sold at an average price of $9.07, for a total transaction of $45,903.27. Following the completion of the transaction, the chief financial officer owned 69,796 shares of the company's stock, valued at $633,049.72. This trade represents a 6.76% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. Insiders have sold a total of 9,673 shares of company stock worth $92,242 over the last three months. Company insiders own 0.38% of the company's stock.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the company. Sanctuary Advisors LLC increased its holdings in Fortrea by 24.6% in the first quarter. Sanctuary Advisors LLC now owns 45,661 shares of the company's stock valued at $430,000 after buying an additional 9,013 shares in the last quarter. Hillsdale Investment Management Inc. purchased a new position in Fortrea in the first quarter valued at $2,990,000. Chicago Partners Investment Group LLC purchased a new position in Fortrea in the first quarter valued at $100,000. Fifth Third Bancorp increased its holdings in Fortrea by 2,502.9% in the first quarter. Fifth Third Bancorp now owns 28,372 shares of the company's stock valued at $267,000 after buying an additional 27,282 shares in the last quarter. Finally, Counterpoint Mutual Funds LLC purchased a new position in Fortrea in the first quarter valued at $291,000.

Fortrea Stock Up 17.2%

The company has a debt-to-equity ratio of 1.86, a current ratio of 0.98 and a quick ratio of 0.98. The business's fifty day simple moving average is $9.88 and its two-hundred day simple moving average is $12.46. The company has a market cap of $1.36 billion, a PE ratio of -1.30, a PEG ratio of 0.45 and a beta of 1.92.

About Fortrea

Fortrea, Inc is a global contract development and manufacturing organization (CDMO) that provides integrated solutions for pharmaceutical and biotechnology companies. Established as a spin-off from Thermo Fisher Scientific's Pharma Services business in October 2023, Fortrea leverages a legacy of scientific expertise and manufacturing scale to support drug development from early-stage research through commercial production. The company's comprehensive offerings address the complex needs of both small-molecule and biologics programs, making it a single source for clients seeking to accelerate timelines and manage costs.

Fortrea's core services encompass analytical and formulation development, process optimization, clinical and commercial manufacturing, and packaging services.

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