Fortive Corporation FTV reported first-quarter 2024 adjusted earnings per share (EPS) of 83 cents, which topped the Zacks Consensus Estimate by 5.1%. The bottom line increased 11% year over year.

Revenues rose 4% year over year to $1.52 billion. However, it missed the Zacks Consensus Estimate by 0.1%. Core revenues also moved up 3% year over year, gaining from acceleration in the Intelligent Operating Solutions and Healthcare segments.

The year-over-year improvement in the top line was driven by continued momentum in the Fortive Business System.

Fortive Corporation Price, Consensus and EPS Surprise Fortive Corporation Price, Consensus and EPS Surprise

Fortive Corporation price-consensus-eps-surprise-chart | Fortive Corporation Quote

On Mar 14, 2024, the company completed a transaction to sell land and certain office buildings in its Precision Technologies segment for $90 million. The company received $20 million in cash proceeds and a $70 million promissory note secured by a letter of credit, with principal due in August and November 2024.

The company also provided guidance for 2024. Management now projects adjusted net EPS between $3.77 and $3.86 compared with the previous guidance of $3.73 and $3.85. The Zacks Consensus Estimate is pegged at $3.78.

Revenues are now anticipated to be between $6.350 billion and $6.425 billion compared with the previous guidance of $6.425 billion and $6.525 billion, indicating 4.5-6% growth from the year-ago levels. The Zacks Consensus Estimate is pegged at $6.49 billion.

Core revenue growth is anticipated to be between 2% and 4%. Free cash flow is forecasted to be $1.385 billion.

Adjusted operating profit is envisioned in the range of $1.720-$1.770 billion, suggesting 9-13% growth from the prior-year levels.

For second-quarter 2024, adjusted net EPS is estimated to be in the range of 90-93 cents. Revenues are envisioned in the $1.550-$1.575 billion band. The Zacks Consensus Estimate for second-quarter EPS and revenues is pegged at 94 cents and $1.63 billion, respectively.

Free cash flow is forecasted to be $270 million. Adjusted operating profit is expected to be in the range of $410-$420 million, indicating 3-6% growth from the year-earlier levels.

The stock was down 5.7% on Apr 24 and closed the session at $76.05. In the past year, shares of FTV have gained 21.1% of their value compared with the sub-industry’s growth of 18.1%. Zacks Investment Research

Image Source: Zacks Investment Research

Top Line in Detail

Fortive operates under the following three organized segments.

Intelligent Operating Solutions: The segment generated revenues of $666 million (contributing 43.7% to total revenues), up 5% on a year-over-year basis.



Precision Technologies: Segmental revenues totaled $559 million (36.7%), up 3% year over year.

Advanced Healthcare Solutions: This segment registered revenues of $300 million (19.6%), up 4% year over year.

Operating Details

In the quarter under review, adjusted gross margin reached 59.5%, which expanded 110 basis points (bps) year over year.

Adjusted operating margin was 25.1%, extending 110 bps on a year-over-year basis.

Segment-wise, adjusted operating margins of Intelligent Operating Solutions and Precision Technologies were 31.9% and 24.4%, rising 160 bps and 80 bps, respectively, year over year.

Advanced Healthcare Solutions’ adjusted operating margin of 24.2% improved 200 bps.

Balance Sheet & Cash Flow

As of Mar 29, 2024, cash and cash equivalents were $704.6 million compared with $1,888.8 million as of Dec 31, 2023.

As of Mar 29, 2024, accounts receivables were $962.6 million compared with $960.8 million as of Dec 31, 2023.

FTV generated an operating cash flow of $256.7 million for the first quarter compared with $174.4 million in the year-ago quarter. Non-GAAP free cash flow was $230.3 million compared with $149.6 million in the prior-year quarter.

Zacks Rank and Other Key Picks

Currently, Fortive has a Zacks Rank #2 (Buy).

Some other top-ranked stocks from the broader technology space are Badger Meter BMI, Pinterest PINS and Arista Networks ANET. Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Badger Meter’s 2024 EPS has increased 9.9% in the past 60 days to $3.89. BMI’s long-term earnings growth rate is 12.3%.

Badger Meter’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 12.7%. BMI shares have risen 35.8% in the past year.

The Zacks Consensus Estimate for PINS’s 2024 EPS has increased 0.7% in the past 60 days to $1.34. PINS’s long-term earnings growth rate is 20.1%.

Pinterest’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, delivering an average earnings surprise of 37.4%. Shares of PINS have gained 13% in the past year.

The Zacks Consensus Estimate for ANET’s 2024 EPS has increased 0.4% in the past 60 days to $7.49. ANET’s long-term earnings growth rate is 17.5%.

Arista Networks’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average earnings surprise of 13.3%. Shares of ANET have gained 62.7% in the past year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Badger Meter, Inc. (BMI):Free Stock Analysis Report

Arista Networks, Inc. (ANET):Free Stock Analysis Report

Fortive Corporation (FTV):Free Stock Analysis Report

Pinterest, Inc. (PINS):Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research