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Fortrea Holdings Inc.
(NASDAQ:FTRE)
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Rating:59Neutral
Price Target:
$19.00
▼(-2.66% Downside)
Action:Reiterated
Date:08/06/26
FTRE scores as neutral-to-modestly positive: strong and improving cash flow plus raised 2026 guidance and solid bookings/backlog support the outlook, but the overall score is held back by persistent GAAP losses and pressured margins alongside still-elevated leverage. Technically, the stock shows improving trend/momentum but not a strong breakout signal, while valuation remains difficult to justify with a negative P/E and no dividend yield support provided.
Positive Factors
Free cash flow generation
Sustained positive operating and free cash flow (~$228M and ~$196M TTM) provides durable liquidity to fund operations, invest in productivity initiatives, pay down debt, and support working capital without relying on external equity — bolstering financial flexibility over the next 2–6 months.
Negative Factors
Profitability deterioration
Material margin compression and a TTM net loss (~-16% net margin) indicate operating leverage is impaired; even with revenue stability, recovering to prior profitability will require sustained margin expansion, higher mix of fee revenue, or structural cost reductions over several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Sustained positive operating and free cash flow (~$228M and ~$196M TTM) provides durable liquidity to fund operations, invest in productivity initiatives, pay down debt, and support working capital without relying on external equity — bolstering financial flexibility over the next 2–6 months.
Read all positive factors
Fortrea Holdings Inc. (FTRE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.82B
Dividend YieldN/A
Average Volume (3M)1.80M
Price to Earnings (P/E)―
Beta (1Y)1.87
Revenue Growth-2.09%
EPS Growth91.98%
CountryUS
Employees14,000
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)-0.93
Shares Outstanding95,100,000
10 Day Avg. Volume2,205,510
30 Day Avg. Volume1,801,545
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)2.79
Price to Sales (P/S)0.58
P/FCF Ratio17.82
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$22.50Price Target Upside15.27% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)0.85
Revenue Forecast (FY)$2.66B
Fortrea Holdings Inc. Business Overview & Revenue Model
Company Description
Fortrea Holdings Inc. functions as a global contract research organization (CRO), concentrating on providing development services for biopharmaceutical products and medical devices. The company's operations are divided into two main segments: Clin...
How the Company Makes Money
Fortrea primarily makes money by providing outsourced clinical research and development services to life sciences sponsors under contractual arrangements. Revenue is generally generated from service fees tied to the planning and execution of clini...
Fortrea Holdings Inc. Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call highlighted substantial commercial momentum (bookings up, net new business +19% H1), improved profitability metrics (adjusted EBITDA growth, cost savings, SG&A reduction), stronger cash generation and an upgraded full-year guidance, alongside early operational wins from FIT/AI and CPS strength. Key risks discussed include a modest YoY revenue decline driven by pass-through/FSP dynamics, elevated customer concentration, a CFO transition related to a restrictive covenant matter, and the early-stage nature of AI benefits. On balance, the positive operational, commercial and financial traction and the guidance raise outweigh the listed challenges.Positive Updates
Revenue and Adjusted EBITDA
Q2 revenue of $678.2M and adjusted EBITDA of $58.7M. Despite a 4.5% year-over-year revenue decline (driven by lower pass-throughs and FSP headwinds), adjusted EBITDA increased to $58.7M (up ~6.9% YoY). Management also raised full-year 2026 guidance to revenue of $2.62B–$2.69B and adjusted EBITDA of $205M–$220M.
Negative Updates
Revenue Decline and Pass-Through / FSP Headwinds
Revenue decreased 4.5% YoY in Q2 primarily due to lower pass-through costs and continued FSP (functional service provider) headwinds. Management noted pass-through volatility and FSP drag remain factors on near-term margin dynamics.
Read all updates
Q2-2026 Updates
Positive
Negative
Revenue and Adjusted EBITDA
Q2 revenue of $678.2M and adjusted EBITDA of $58.7M. Despite a 4.5% year-over-year revenue decline (driven by lower pass-throughs and FSP headwinds), adjusted EBITDA increased to $58.7M (up ~6.9% YoY). Management also raised full-year 2026 guidance to revenue of $2.62B–$2.69B and adjusted EBITDA of $205M–$220M.
Read all positive updates
Company Guidance
Fortrea raised full‑year 2026 guidance to revenue of $2.62–$2.69 billion and adjusted EBITDA of $205–$220 million and reiterated expectations for positive free cash flow for the remainder of 2026 and the full year; management cited Q2 results that supported the upgrade — revenue of $678.2 million, adjusted EBITDA $58.7 million, adjusted net income $22.7 million (adjusted EPS $0.24 basic/$0.23 diluted), net loss $13.2 million, operating cash flow $28.9 million and free cash flow $19.9 million. Commercial momentum included $720.4 million of Q2 net new business, a book‑to‑bill of 1.06x (trailing 12‑month 1.12x) and first‑half net new business up 19% YoY; backlog was $7.8 billion with 8.6% backlog burn. Management also highlighted available liquidity in excess of $0.5 billion, net AR and unbilled services of $654.4 million (vs. $739.2M a year ago), YTD gross cost savings of $34 million (net $19M), Q2 interest expense of $19.3 million (down $4M) and ~35% of original debt paid down since the spin.Fortrea Holdings Inc. Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
45
Neutral
Cash Flow
67
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.68B | 2.72B | 2.70B | 2.84B | 2.84B | 3.06B |
| Gross Profit | 457.90M | 425.80M | 534.20M | 590.60M | 724.40M | 604.40M |
| EBITDA | 81.20M | -813.60M | -64.30M | 137.20M | 280.80M | 302.90M |
| Net Income | -85.20M | -986.20M | -328.50M | -25.20M | 186.20M | 98.00M |
Balance Sheet | ||||||
| Total Assets | 2.71B | 2.72B | 3.58B | 4.33B | 4.29B | 4.37B |
| Cash, Cash Equivalents and Short-Term Investments | 168.60M | 174.60M | 118.50M | 108.60M | 112.00M | 94.60M |
| Total Debt | 80.30M | 1.12B | 1.20B | 1.67B | 63.40M | 77.20M |
| Total Liabilities | 2.19B | 2.15B | 2.22B | 2.62B | 945.30M | 1.11B |
| Stockholders Equity | 524.20M | 563.50M | 1.36B | 1.71B | 3.34B | 3.26B |
Cash Flow | ||||||
| Free Cash Flow | 150.60M | 88.30M | 237.30M | 128.10M | 28.30M | 143.30M |
| Operating Cash Flow | 182.40M | 113.50M | 262.80M | 168.40M | 82.70M | 169.80M |
| Investing Cash Flow | -9.20M | 14.40M | 251.60M | -31.80M | -54.00M | -26.20M |
| Financing Cash Flow | -125.70M | -76.30M | -497.80M | -140.80M | -6.30M | -128.50M |
Fortrea Holdings Inc. Technical Analysis
Positive
19.52
Price Trends
17.44
Positive
14.38
Positive
13.86
Positive
Market Momentum
0.38
Positive
51.17
Neutral
20.09
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FTRE, the sentiment is Positive. The current price of 19.52 is above the 20-day moving average (MA) of 18.66, above the 50-day MA of 17.44, and above the 200-day MA of 13.86, indicating a neutral trend. The MACD of 0.38 indicates Positive momentum. The RSI at 51.17 is Neutral, neither overbought nor oversold. The STOCH value of 20.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FTRE.
Fortrea Holdings Inc. Risk Analysis
Fortrea Holdings Inc. disclosed 57 risk factors in its most recent earnings report. Fortrea Holdings Inc. reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fortrea Holdings Inc. Peers Comparison
UnderperformOutperform
Sector (51)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
61 Neutral | $3.14B | -29.97 | -26.01% | ― | ― | -0.43% | |
59 Neutral | $1.82B | -20.61 | -15.53% | ― | -2.09% | 91.98% | |
55 Neutral | $1.70B | -9.06 | -35.42% | ― | -15.35% | 37.09% | |
54 Neutral | $1.74B | -11.90 | -17.49% | ― | 242.66% | 15.53% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
51 Neutral | $1.59B | -2.50 | -50.41% | ― | 11.07% | 32.35% | |
49 Neutral | $1.79B | -2.81 | 38.68% | ― | ― | ― |
* Healthcare Sector Average
FTRE
Fortrea Holdings Inc.
18.43
12.04
188.42%
MRVI
Maravai Lifesciences Holdings
6.23
4.17
202.43%
ABCL
AbCellera Biologics
6.93
2.43
54.00%
RXRX
Recursion Pharmaceuticals
3.22
-2.07
-39.13%
MBX
MBX Biosciences, Inc.
67.82
56.56
502.31%
GENB
Generate Biomedicines, Inc.
14.35
1.70
13.44%
Fortrea Holdings Inc. Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial DisclosuresLegal Proceedings
Fortrea Names Interim CFO Amid Ongoing Legal Dispute
Positive
Jul 29, 2026
On July 27, 2026, Fortrea’s board appointed current director David Smith as interim chief financial officer, following a July 25, 2026 Delaware Court order temporarily restraining newly hired CFO Jason Knoblauch from serving due to litigatio...
Executive/Board Changes
Fortrea Announces Key Accounting Leadership Transition Plans
Neutral
Jul 15, 2026
On July 8, 2026, Fortrea announced that Chief Accounting Officer and principal accounting officer Robert A. Parks will resign effective August 7, 2026 to pursue an opportunity outside the contract research organization industry, with the company s...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Fortrea Appoints New CFO and Reaffirms 2026 Outlook
Positive
Jun 26, 2026
On June 26, 2026, Fortrea announced that Jason Knoblauch has been appointed chief financial officer, effective July 6, 2026, succeeding Jill McConnell, who will step down from the role but remain with the company for a transition period. The compa...
Executive/Board ChangesShareholder Meetings
Fortrea Stockholders Approve Directors, Auditor and Executive Pay
Positive
Jun 12, 2026
On June 9, 2026, Fortrea Holdings Inc. held its 2026 Annual Meeting of Stockholders, with 86,194,966 of 94,584,730 eligible shares present or represented by proxy, establishing a quorum. Shareholders elected directors Anshul Thakral, Peter M. Neup...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.