Fortrea Holdings Inc. (FTRE)

Price$17.70Cached quoteAs of 2026-09-06 14:03 UTC

AI: Fair-priced

Price checkThe shares look fairly priced because recovery value is balanced by heavy debt and weak cash.

At the observed quote, 95.1 million shares imply about $1.63 billion of equity value. Adding roughly $886 million of net borrowings gives about $2.52 billion for the whole operating business, or 11.5–12.3 times management’s $205–$220 million 2026 adjusted profit before interest, taxes, depreciation and company-selected exclusions. That is not plainly cheap with falling sales and negative first-half free cash flow—cash left after operations and capital spending. Yet stronger bookings and margins make an overvaluation call too harsh.

Big pictureOperations are improving, but revenue is still shrinking and cash generation remains uneven.

Quarterly revenue fell 4.5% year over year and first-half revenue fell 3.4%, yet adjusted operating profit rose to $105.7 million from $85.2 million as costs declined. Sales move with drugmakers’ study starts and staffing choices: lower demand for outsourced trial staff hurt, while clinical pharmacology grew. The first half produced $11.9 million of operating cash against $17.0 million of capital spending, so free cash flow was negative. Full-year free cash flow fell from $237.3 million in 2024 to $88.3 million in 2025.

Business strengthA large order book and cost cuts help, while heavy borrowing and dilution limit resilience.

Backlog was $7.8 billion, while work won exceeded revenue for four straight quarters; however, most contracts can be cancelled on 30–90 days’ notice. Cash was $168.6 million against $1.12 billion of total debt including lease obligations, and current liabilities slightly exceeded current assets, although $447.7 million of unused borrowing capacity supports liquidity. Debt has fallen about $555 million since 2023. Conversely, shares increased 7.1% from 88.8 million at 2023 year-end to 95.1 million, while first-half stock pay totaled $24.0 million; there were no buybacks or dividends.

What could change the storySustained sales growth and stronger cash would unlock upside; stalled orders would expose downside.

The current valuation assumes guidance is achieved and recent bookings become growth, not merely replacement work. The bull case needs the $7.8 billion backlog to turn into sales growth, plus annual free cash flow above roughly $100 million, falling debt and a stable share count. Management now targets $2.62–$2.69 billion of 2026 revenue and $205–$220 million of adjusted operating profit. Further weakness in outsourced staffing, cancelled studies, renewed cash burn, or difficulty refinancing the $400 million term loan due in 2028 would break that recovery case.

AI: News

Guidance raisedFortrea raised yearly profit guidance as bookings and adjusted earnings improved despite lower sales.

On July 29, second-quarter revenue fell 4.5% to $678.2 million, but adjusted earnings per share rose to $0.23 from $0.19 and adjusted operating profit increased to $58.7 million from $54.9 million. Work won equaled 1.06 times quarterly revenue, the fourth straight quarter above one. Management lifted 2026 revenue guidance to $2.62–$2.69 billion from $2.55–$2.65 billion and raised the profit range’s low end to $205 million from $190 million. This improves confidence, though sales still declined.

Early-trial acquisitionFortrea agreed to buy an early-trial unit, adding useful capacity but spending scarce cash.

On September 2, Fortrea signed an all-cash agreement to acquire Worldwide Clinical Trials’ Early Phase Services business for about $45 million. The assets include a 60,000-square-foot bioanalytical laboratory, a 200-bed clinical pharmacology unit and a specimen-storage site in Texas. They could deepen a business that was already growing while reducing handoffs in early studies. However, Fortrea disclosed no acquired revenue or profit, so the return is uncertain. Shares rose 3.6% that day, but timing alone does not establish the deal caused the move.

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Revenue

2021

2022

2023

2024

2025

Net income

2021

2022

2023

2024

2025

Free cash flow

2021

2022

2023

2024

2025

Total cash / debt

CashTotal debt

2021

2022

2023

2024

2025

Financial statements

	2025	2024	2023	2022	2021
Revenue	$2.72B	$2.70B	$2.84B	$2.84B	$3.06B
Gross profit	$503.8M	$534.2M	$590.6M	$724.4M	$604.4M
Gross margin	18.50%	19.81%	20.78%	25.53%	19.77%
Operating expenses	$3.60B	$2.86B	$2.81B	$2.65B	$2.94B
Operating income	−$872.6M	−$161.9M	$32.0M	$187.1M	$114.3M
Operating margin	−32.04%	−6.00%	1.13%	6.59%	3.74%
EBITDA	−$794.6M	−$75.0M	$130.0M	$280.7M	$280.6M
EBITDA margin	−29.18%	−2.78%	4.57%	9.89%	9.18%
Net income	−$986.2M	−$328.5M	−$25.2M	$186.2M	$98.0M
Net profit margin	−36.21%	−12.18%	−0.89%	6.56%	3.21%
Basic EPSper basic share	-$10.81	-$3.67	-$0.29	$2.09	$1.10
Diluted EPSper diluted share	-$10.81	-$3.67	-$0.29	$2.09	$1.10

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

16.61%of listed shares

BlackRock, Inc.15.8M shares · Jun 30, 2026

View holders

Top 20 reported holders of FTRE
Holder	% owned
BlackRock, Inc.	16.61%15.8M shares
GOLDMAN SACHS GROUP INC	8.85%8.41M shares
Sessa Capital IM, L.P.	4.83%4.59M shares
VANGUARD CAPITAL MANAGEMENT LLC	4.40%4.18M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	4.01%3.82M shares
STATE STREET CORP	3.98%3.78M shares
FMR LLC	3.83%3.65M shares
Corvex Management LP	3.14%2.99M shares
AQR CAPITAL MANAGEMENT LLC	3.13%2.98M shares
GEODE CAPITAL MANAGEMENT, LLC	2.68%2.55M shares
CHARLES SCHWAB INVESTMENT MANAGEMENT INC	2.62%2.49M shares
LOOMIS SAYLES & CO L P	2.57%2.44M shares
WELLINGTON MANAGEMENT GROUP LLP	2.51%2.38M shares
Park West Asset Management LLC	2.21%2.11M shares
MORGAN STANLEY	2.20%2.09M shares
AMERIPRISE FINANCIAL INC	1.81%1.72M shares
DIMENSIONAL FUND ADVISORS LP	1.74%1.65M shares
Nuveen, LLC	1.50%1.42M shares
DEUTSCHE BANK AG\	1.47%1.4M shares
MetLife Investment Management, LLC	1.43%1.36M shares

Percentages use 95.1M shares of this listed class outstanding on Jun 30, 2026.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys3$507.2K disclosed value

Sells (SEC code S)38$984.1K disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 10, 2026Form 4	Morais Mark A.Chief Operating Officer	SellCommon Stock	4.7K	$16.82	$78.6K	71.4K
Jun 2, 2026Form 4	Morais Mark A.Chief Operating Officer	SellCommon Stock	4.9K	$15.49	$75.4K	76.0K
Jun 2, 2026Form 4	Mcconnell Jill G.Chief Financial Officer	SellCommon Stock	4.9K	$15.49	$75.4K	78.4K
May 18, 2026Form 4	Parks RobertChief Accounting Officer	SellCommon Stock	2.0K	$13.44	$26.9K	20.4K
Mar 16, 2026Form 4	Morais Mark A.Chief Operating Officer	SellCommon Stock	1.8K	$9.22	$16.6K	69.9K