Latest news with #ThomasPike
Yahoo
12-05-2025
- Business
- Yahoo
Why Fortrea (FTRE) Stock Is Falling Today
Shares of clinical research company Fortrea Holdings (NASDAQ:FTRE) fell 14.3% in the afternoon session after the company reported first quarter 2025 earnings as the news of the CEO stepping down dominated, casting a shadow over the otherwise decent results. The company announced that Lead Independent Director, Peter M. Neupert, will serve as Interim Chief Executive Officer and Board Chair, as Thomas Pike stepped down from his role beginning May 13, 2025. This likely created some uncertainty regarding the near-term direction of the business, which investors typically react negatively to. Also, sales slipped a bit compared to the previous year. Still, Fortrea blew past analysts' sales and earnings forecasts. Zooming out, we think this quarter featured some important positives marred by the uncertainty of leadership. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Fortrea? Access our full analysis report here, it's free. Fortrea's shares are extremely volatile and have had 41 moves greater than 5% over the last year. But moves this big are rare even for Fortrea and indicate this news significantly impacted the market's perception of the business. The biggest move we wrote about over the last year was 2 months ago when the stock dropped 18.5% on the news that the company delivered weak fourth-quarter 2024 results, with sales, operating profits, and earnings all falling short of Wall Street's expectations. Not exactly the kind of report investors like to see. But if there's a silver lining, it's the book-to-bill ratio of 1.35x which means demand for future orders is still strong, even though current revenues took a hit. Profitability didn't fare much better. Adjusted EBITDA fell, due to higher restructuring costs and rising expenses. That led to a bigger operating loss compared to last year, which is why earnings came in weaker than expected. And to top it off, the company issued weaker-than-expected full-year revenue and EBITDA guidance, suggesting those future orders might not translate into sales and profits as fast as expected. Management did say that the company is shifting from a restructuring phase to a transformation strategy, which suggests there is a plan to accelerate growth. So while this quarter was a tough one, the demand trends suggest there could be better days ahead if they can execute on their strategy. Fortrea is down 70.5% since the beginning of the year, and at $5.50 per share, it is trading 80.9% below its 52-week high of $28.84 from May 2024. Investors who bought $1,000 worth of Fortrea's shares at the IPO in June 2023 would now be looking at an investment worth $182.72. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
12-05-2025
- Business
- Yahoo
Fortrea's (NASDAQ:FTRE) Q1: Strong Sales, Full-Year Outlook Slightly Exceeds Expectations
Clinical research company Fortrea Holdings (NASDAQ:FTRE) beat Wall Street's revenue expectations in Q1 CY2025, but sales fell by 1.6% year on year to $651.3 million. The company's full-year revenue guidance of $2.5 billion at the midpoint came in 0.7% above analysts' estimates. Its non-GAAP profit of $0.02 per share was significantly above analysts' consensus estimates. Is now the time to buy Fortrea? Find out in our full research report. CEO Thomas Pike is stepping down Revenue: $651.3 million vs analyst estimates of $608 million (1.6% year-on-year decline, 7.1% beat) Adjusted EPS: $0.02 vs analyst estimates of -$0.07 (significant beat) Adjusted EBITDA: $205.7 million vs analyst estimates of $22.14 million (31.6% margin, significant beat) The company reconfirmed its revenue guidance for the full year of $2.5 billion at the midpoint EBITDA guidance for the full year is $185 million at the midpoint, above analyst estimates of $172.7 million Operating Margin: -79.9%, down from -5.6% in the same quarter last year Free Cash Flow was -$127.1 million compared to -$34.9 million in the same quarter last year Market Capitalization: $556.8 million 'Fortrea's first quarter performance represents a solid start to 2025,' said Tom Pike, Chairman and CEO of Fortrea. Spun off from Labcorp in 2023 to focus exclusively on clinical research services, Fortrea (NASDAQ:FTRE) is a contract research organization that helps pharmaceutical, biotech, and medical device companies develop and bring their products to market through clinical trials and support services. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last three years, Fortrea's demand was weak and its revenue declined by 4.4% per year. This was below our standards and is a sign of poor business quality. Long-term growth is the most important, but within healthcare, a stretched historical view may miss new innovations or demand cycles. Fortrea's recent performance shows its demand remained suppressed as its revenue has declined by 5.6% annually over the last two years. This quarter, Fortrea's revenue fell by 1.6% year on year to $651.3 million but beat Wall Street's estimates by 7.1%. Looking ahead, sell-side analysts expect revenue to decline by 7.3% over the next 12 months, a slight deceleration versus the last two years. This projection is underwhelming and suggests its products and services will see some demand headwinds. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next. Fortrea's high expenses have contributed to an average operating margin of negative 2.4% over the last four years. Unprofitable healthcare companies require extra attention because they could get caught swimming naked when the tide goes out. It's hard to trust that the business can endure a full cycle. Looking at the trend in its profitability, Fortrea's operating margin decreased by 27.9 percentage points over the last four years. This performance was caused by more recent speed bumps as the company's margin fell by 31.2 percentage points on a two-year basis. We're disappointed in these results because it shows its expenses were rising and it couldn't pass those costs onto its customers. This quarter, Fortrea generated a negative 79.9% operating margin. The company's consistent lack of profits raise a flag. We track the change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company's growth is profitable. Sadly for Fortrea, its EPS declined by 45.7% annually over the last three years, more than its revenue. This tells us the company struggled because its fixed cost base made it difficult to adjust to shrinking demand. In Q1, Fortrea reported EPS at $0.02, up from negative $0.05 in the same quarter last year. This print easily cleared analysts' estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Fortrea's full-year EPS of $0.41 to grow 27.3%. We were impressed by how significantly Fortrea blew past analysts' EPS expectations this quarter. We were also excited its revenue outperformed Wall Street's estimates by a wide margin. Zooming out, we think this quarter featured some important positives. Still, news of the CEO stepping down dominated, and shares traded down 2.4% to $6.01 immediately after reporting. Is Fortrea an attractive investment opportunity right now? We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free.
Associated Press
12-05-2025
- Business
- Associated Press
Fortrea Announces CEO Stepping Down
DURHAM, N.C., May 12, 2025 (GLOBE NEWSWIRE) -- Fortrea (Nasdaq: FTRE) (the 'Company'), a leading global contract research organization (CRO), today announced that Thomas Pike is stepping down from his role as Fortrea's Chief Executive Officer and as Chairman of its Board. Fortrea's Lead Independent Director, Peter M. Neupert, will serve as Interim Chief Executive Officer and Board Chair, beginning May 13, 2025. As part of a succession planning process, an executive search is already at an advanced stage. Mr. Pike has entered into a consulting agreement with the Company to serve as a resource to its leadership team through the transition. 'On behalf of Fortrea's Board, I would like to thank Tom for his invaluable contributions and leadership to Fortrea during a pivotal time,' said Neupert. 'Tom has led the company through a challenging period, navigating a complex operating environment while laying critical groundwork for long-term improvement. With Fortrea now operating as a fully independent company as it approaches two years since its spin, Tom and the Board agreed that this is the right time to move ahead with this planned transition.' 'The Fortrea story is more than 30 years in the making, and it's time for the next chapter,' said Pike. 'Since joining almost two and a half years ago when Fortrea was still notional, I have been honored to work with the leadership team as we led the Company's formation and transition, delivered for our customers, and developed an extraordinary team of talented people around the world. Over time, we have created a leading, agile CRO, bringing unique focus and capabilities to address the needs of customers and achieve our patient-inspired purpose. I am proud of our shared achievements and believe the best is yet to come.' Peter M. Neupert is a seasoned leader and board member with a track record of success in the healthcare and technology industries. He served as an Operating Partner at Health Evolution Partners, a private equity fund, from February 2012 to July 2014. Prior to joining Health Evolution Partners, Neupert served as Corporate Vice President, Health Solutions Group at Microsoft from August 2005 to January 2012, and as the founding Chief Executive Officer and Chairman of the board of directors of which he joined in July 1998. Earnings Call and Replay Fortrea will hold its earnings conference call at 9 a.m. ET on May 12, 2025, which will include a question and answer session. To participate in the earnings call, participants should register online at the Fortrea Investor Relations website. To avoid potential delays, please join at least 10 minutes prior to the start of the call. The conference call can also be accessed through the following earnings webcast link. A replay of the live conference call will be available shortly after the conclusion of the event and accessible on the events and presentations section of the Fortrea website. A supplemental slide presentation will also be available on the Investor Relations website prior to the start of the call. About Fortrea Fortrea (Nasdaq: FTRE) is a leading global provider of clinical development solutions to the life sciences industry. We partner with emerging and large biopharmaceutical, biotechnology, medical device and diagnostic companies to drive healthcare innovation that accelerates life changing therapies to patients. Fortrea provides phase I-IV clinical trial management, clinical pharmacology and consulting services. Fortrea's solutions leverage three decades of experience spanning more than 20 therapeutic areas, a passion for scientific rigor, exceptional insights and a strong investigator site network. Our talented and diverse team working in about 100 countries is scaled to deliver focused and agile solutions to customers globally. Learn more about how Fortrea is becoming a transformative force from pipeline to patient at and follow us on LinkedIn and X (formerly Twitter). Cautionary Statement Regarding Forward-Looking Statements This press release contains 'forward-looking statements' within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as 'guidance,' 'expect,' 'assume,' 'anticipate,' 'intend,' 'plan,' 'forecast,' 'believe,' 'seek,' 'see,' 'will,' 'would,' 'target,' similar expressions, and variations or negatives of these words that are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially from the Company's expectations due to a number of factors, including, but not limited to, the following: the duration and results of the search for a new chief executive officer; the Company's ability to successfully implement the Company's business strategies and execute the Company's long-term value creation strategy; risks and expenses associated with the Company's international operations, tariff policies, trade sanctions and other trade restrictions, and currency fluctuations; the Company's customer or therapeutic area concentrations; any further deterioration in the macroeconomic environment or further changes in government regulations and funding, which could lead to defaults or cancellations by the Company's customers; the risk that the Company's backlog and net new business may not be indicative of the Company's future revenues and that the Company might not realize all of the anticipated future revenue reflected in the Company's backlog; the Company's ability to generate sufficient net new business awards, or if net new business awards are delayed, terminated, reduced in scope, or fail to go to contract; if the Company underprices its contracts, overruns its cost estimates, or fails to receive approval for, or experiences delays in documentation of change orders; and other factors described from time to time in documents that the Company files with the SEC. For a further discussion of the risks relating to the Company's business, see the 'Risk Factors' Section of the Company's Annual Report on Form 10-K for the year ended December 31. 2024, as filed with the Securities and Exchange Commission (the 'SEC'), as such factors may be amended or updated from time to time in the Company's subsequent periodic and other filings with the SEC, which are accessible on the SEC's website at These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company's filings with the SEC. All forward-looking statements are made only as of the date of this release, and the Company does not undertake any obligation, other than as may be required by law, to update or revise any forward-looking statements to reflect future events or developments. Fortrea Contacts: Hima Inguva (Investors) – 877-495-0816, [email protected] Sue Zaranek (Media) – 919-943-5422, [email protected] Kate Dillon (Media) – 646-818-9115, [email protected]
