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Fortrea Holdings Inc. is a leading global contract research organization ( CRO ), providing biopharmaceutical product and medical device development solutions to pharmaceutical, biotechnology and medical device customers. We provide phase I through IV clinical trial management, clinical pharmacology, and consulting services for our customers.
The business is unprofitable at the operating level (-32.04% margin). The thesis depends entirely on whether and when it reaches sustainable profitability.
Revenue growth slowed to 1.0%, essentially flat. Margins also contracted 26.0pp. This is a business that needs a catalyst.
Free cash flow declined 63% versus the prior year, cash generation momentum has weakened. ROIC dropped from -4.28% to -32.51%, capital efficiency is deteriorating.
Profitability & Returns
Revenue (TTM)
$2.71B
▲ +1.0% YoY
Net Income (TTM)
-$447M
▼ -200.2% YoY
Op. Margin
-13.14%
▼ -26.0pp YoY
ROIC
-16.25%
▼ -28.2pp YoY
Cash Flow & Balance Sheet
FCF (TTM)
$190M
▼ -62.8% YoY
Op. Cash Flow (TTM)
$221M
▼ -56.8% YoY
Net Debt
$971M
Cash & Equiv.
$148M
3Y CAGR: -1.4%
3Y CAGR: +46.1%
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