FTRE Earnings Prediction
The chart below shows how FTRE performed 10 days before and after its earnings report, based on data from the past quarters. Typically, FTRE sees a +15.41% change in stock price 10 days leading up to the earnings, and a +1.50% change 10 days following the report. On the earnings day itself, the stock moves by -7.80%. This data can give you a slight idea of what to expect for the next quarter's release.
FTRE Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
674.90M
-13.07%
1.89%
Gross Margin
18.83%
39.90%
7.78%
Operating Margin
-1.36%
-141.21%
-77.74%
Net Margin
-2.74%
62.13%
-81.72%
EPS
-0.31
-106.67%
-80.00%
No Data Available
FTRE Earnings Analysis
Fortrea Holdings Inc. Common Stock Corporation (FTRE.O) Earnings Conference Call
Positive
Book-to-Bill Success: 1. Strong Book-to-Bill Ratio: Fortrea achieved a book-to-bill ratio of 1.23 for the quarter, indicating robust demand and successful project closures with both large pharmaceutical and biotech customers.
Backlog Increase: 2. Growing Backlog: The company's backlog increased by 6.2% over the past 12 months, reaching approximately $7.6 billion, reflecting strong future revenue potential.
Adjusted Net Income Increase: 3. Improved Adjusted Net Income: Adjusted net income for the quarter rose to $20.7 million, a 3% increase compared to $20.1 million in the prior year, demonstrating effective cost management and operational efficiency.
Cash Flow Improvement: 4. Significant Cash Flow Generation: Fortrea reported $245.7 million in cash flow from operating activities for the nine months ended September 30, 2024, compared to $150 million generated in the prior year, highlighting improved cash generation capabilities.
Interest Expense Reduction: 5. Decreased Interest Expense: Net interest expense for the quarter decreased by $12.2 million year-over-year to $22.4 million, benefiting from repayments made on Term Loan A and Term Loan B, which enhances financial stability.
Negative
Revenue Decline Analysis: 1. Declining Revenue: Fortrea reported revenues of $674.9 million for Q3 2024, a decline of 5.4% year-on-year, primarily due to lower service fee and pass-through revenues.
Rising SG&A Expenses: 2. Increased SG&A Costs: SG&A expenses rose by 27.6% year-over-year to 20.2% of revenue, driven by higher professional fees and one-time costs associated with exiting the Transition Services Agreement (TSA).
Decline in Adjusted EBITDA: 3. Decreased Adjusted EBITDA: Adjusted EBITDA for the quarter was $64.2 million, down 5.9% from $68.2 million in the prior year, with a slight decrease in adjusted EBITDA margin from 9.6% to 9.5%.
Customer Dependency Risk: 4. High Customer Concentration: The top 10 customers accounted for 51% of revenues in Q3 2024, with one customer alone representing 15.1% of total revenues, indicating a significant reliance on a limited customer base.
Service Fee Revenue Decline: 5. Lower Service Fee Revenue: The decline in service fee revenue was attributed to lower new business awards during the pre-spin period and a mix of later-stage studies, impacting overall financial performance.
FTRE FAQs
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FTRE Earning Call Sentiment
Fortrea Holdings, Inc. (FTRE) Q3 2024 Earnings Call Transcript
1.0x
00:00
00:00
FTRE.O
-4.68%Positive
The company's earnings call reveals several challenges: declining revenue and EBITDA, increased SG&A expenses, and high customer concentration risk. Despite some positives like improved cash flow and backlog, the lowered guidance and lack of a share repurchase program weigh heavily. The Q&A session highlights uncertainties, especially around future guidance and large pharma restructurings. While there are some positive developments, the overall sentiment is negative, exacerbated by the lowered revenue and EBITDA guidance, which are likely to impact the stock negatively over the next two weeks.
