Fortrea Holdings Inc. (FTRE)
NASDAQ:FTRE
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Fortrea Holdings Inc.
(NASDAQ:FTRE)
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Rating:48Neutral
Price Target:
$9.50
▲(0.64% Upside)
Action:ReiteratedDate:02/27/26
FTRE scores below average primarily due to sharply worsening profitability and weakening cash-flow trend, reinforced by bearish technical signals. The score is supported somewhat by reduced leverage, continued positive free cash flow, and an earnings call that outlined tangible cost/cash improvements and 2026 EBITDA/cash-flow targets, though revenue headwinds remain a key risk.
Positive Factors
Material debt reduction and stronger leverage
Substantial debt paydown materially reduces financial risk and increases balance-sheet flexibility. Lower leverage supports covenant headroom, enables continued investment in operations or strategic initiatives, and reduces interest burden—durable advantages for multi‑quarter recovery execution.
Negative Factors
Sharply deteriorated profitability and negative margins
Large multi-year losses and deeply negative margins reflect structural profitability issues that require sustained revenue recovery and continued cost discipline to reverse. Losses erode equity, constrain reinvestment, and make multi‑quarter restoration of ROE and peer‑level margins challenging.
Read all positive and negative factors
Positive Factors
Negative Factors
Material debt reduction and stronger leverage
Substantial debt paydown materially reduces financial risk and increases balance-sheet flexibility. Lower leverage supports covenant headroom, enables continued investment in operations or strategic initiatives, and reduces interest burden—durable advantages for multi‑quarter recovery execution.
Read all positive factors
Fortrea Holdings Inc. (FTRE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$892.92M
Dividend YieldN/A
Average Volume (3M)1.80M
Price to Earnings (P/E)―
Beta (1Y)1.78
Revenue Growth-0.54%
EPS Growth-259.57%
CountryUS
Employees15,000
SectorHealthcare
Sector Strength45
IndustryBiotechnology
Share Statistics
EPS (TTM)0.09
Shares Outstanding93,500,000
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 Cap0.88
Enterprise Value/Revenue0.29
Enterprise Value/Gross Profit1.77
Enterprise Value/Ebitda-0.97
Forecast
1Y Price Target
$15.86Price Target Upside68.01% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)0.69
Revenue Forecast (FY)$2.62B
Fortrea Holdings Inc. Business Overview & Revenue Model
Company Description
Fortrea Holdings Inc., a contract research organization, primarily engages in the provision of biopharmaceutical product and medical device development services worldwide. It operates through two segments: Clinical Services and Enabling Services. ...
How the Company Makes Money
Fortrea primarily makes money by providing fee-based outsourced clinical research and development services to life-sciences sponsors. Revenue is generally generated through contracts to run and support clinical trials, where Fortrea is paid for de...
Fortrea Holdings Inc. Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 18, 2026
Earnings Call Sentiment Neutral
The call balanced measurable operational and financial progress (positive cash generation in Q4, exceeded cost-savings targets, debt paydown, improved DSO, backlog and book-to-bill stabilization, AI investments and commercial wins) against persistent near-term revenue headwinds (Q4 revenue decline, FSP/pass-through variability, and 2026 revenue guidance implying a YoY decline). Management reiterated a multi‑pillar turnaround approach and provided a constructive outlook for improving EBITDA and cash flow across 2026, while cautioning the recovery may be uneven in the first half. Overall, the call reflected cautious optimism with concrete execution on cost and cash metrics but continued top-line risks that make recovery incremental.Positive Updates
Revenue in Line with Full-Year Guidance
Full year 2025 revenue of $2,723.4 million, up ~1% year-over-year and reported in line with management guidance; Q4 2025 revenue was $660.5 million.
Negative Updates
Quarterly Revenue Decline
Q4 2025 revenue declined 5.2% year-over-year to $660.5 million, driven primarily by lower pass-through costs in clinical pharmacology and clinical development and continued FSP headwinds.
Read all updates
Q4-2025 Updates
Positive
Negative
Revenue in Line with Full-Year Guidance
Full year 2025 revenue of $2,723.4 million, up ~1% year-over-year and reported in line with management guidance; Q4 2025 revenue was $660.5 million.
Read all positive updates
Company Guidance
Fortrea's 2026 guidance calls for revenue of $2.55–$2.65 billion and adjusted EBITDA of $190–$220 million, with the company targeting positive full‑year operating cash flow (while expecting Q1 cash flow to be negative due to variable compensation payouts and a partial reversal of DSO timing, with that Q1 use of cash to be more than offset by positive cash generation in the rest of the year). Management expects incremental 2026 cost savings of roughly $70–80 million gross and $40–50 million net (moving compensation toward normalized levels by year‑end), plans continued debt repayment (Q4 2025 repurchased ~$75.7 million of senior notes and ~35% of original debt has been paid since the spin), and expects to maintain ample liquidity and covenant flexibility (available liquidity >$600 million with the revolver undrawn). Key operating/leading metrics cited at year‑end 2025: DSO 16 days (improved 17 days sequentially, 24 days YoY), Q4 book‑to‑bill 1.14x (trailing 12‑month 1.02x), backlog $7.7 billion and Q4 backlog burn 8.6%; management noted 2026 revenue pressure primarily from FSP headwinds, first‑half 2025 booking effects and reduced pass‑throughs, and expects margins to gradually improve through the year toward peer‑level (mid‑teens) over a multi‑year path.Fortrea Holdings Inc. Financial Statement Overview
Summary
Income Statement
22
Negative
Balance Sheet
54
Neutral
Cash Flow
43
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.72B | 2.70B | 2.84B | 2.84B | 3.06B |
| Gross Profit | 425.80M | 534.20M | 590.60M | 724.40M | 604.40M |
| EBITDA | -813.60M | -64.30M | 137.20M | 280.80M | 302.90M |
| Net Income | -986.20M | -328.50M | -25.20M | 186.20M | 98.00M |
Balance Sheet | |||||
| Total Assets | 2.72B | 3.58B | 4.33B | 4.29B | 4.37B |
| Cash, Cash Equivalents and Short-Term Investments | 174.60M | 118.50M | 108.60M | 112.00M | 94.60M |
| Total Debt | 68.00M | 1.20B | 1.67B | 63.40M | 77.20M |
| Total Liabilities | 2.15B | 2.22B | 2.62B | 945.30M | 1.11B |
| Stockholders Equity | 563.50M | 1.36B | 1.71B | 3.34B | 3.26B |
Cash Flow | |||||
| Free Cash Flow | 88.30M | 237.30M | 128.10M | 28.30M | 143.30M |
| Operating Cash Flow | 113.50M | 262.80M | 168.40M | 82.70M | 169.80M |
| Investing Cash Flow | 14.40M | 251.60M | -31.80M | -54.00M | -26.20M |
| Financing Cash Flow | -76.30M | -497.80M | -140.80M | -6.30M | -128.50M |
Fortrea Holdings Inc. Technical Analysis
Negative
9.44
Price Trends
12.51
Negative
13.27
Negative
10.55
Negative
Market Momentum
-0.73
Negative
38.33
Neutral
63.69
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FTRE, the sentiment is Negative. The current price of 9.44 is below the 20-day moving average (MA) of 9.78, below the 50-day MA of 12.51, and below the 200-day MA of 10.55, indicating a bearish trend. The MACD of -0.73 indicates Negative momentum. The RSI at 38.33 is Neutral, neither overbought nor oversold. The STOCH value of 63.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
57 Neutral | $2.04B | -5.95 | -399.10% | ― | -32.79% | 36.87% | |
55 Neutral | $4.71B | -8.47 | -32.00% | ― | ― | 45.66% | |
52 Neutral | $959.87M | -12.74 | -43.61% | ― | -100.00% | -28.79% | |
51 Neutral | $7.86B | -0.30 | -43.30% | 2.27% | 22.53% | -2.21% | |
49 Neutral | $462.21M | -9.57 | -30.25% | ― | -100.00% | -305.92% | |
48 Neutral | $892.92M | -12.10 | -102.41% | ― | -0.54% | -259.57% | |
42 Neutral | $408.96M | -3.90 | -69.67% | ― | ― | -11.41% |
* Healthcare Sector Average
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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.