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Valued at a market cap of $26.7 billion, Fortive Corporation (FTV) is a diversified industrial growth company that delivers industrial technology and professional instrumentation solutions globally. The Everett, Washington-based company serves customers across three segments: Intelligent Operating Solutions; Precision Technologies; and Advanced Healthcare Solutions.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and Fortive fits this criterion perfectly. Fortive's portfolio includes advanced software, services, and engineered products marketed under renowned brands such as FLUKE, TEKTRONIX, and ASP. Its innovative solutions support industries ranging from healthcare and manufacturing to aerospace, power, and energy.
However, the company has dipped 11.6% from its 52-week high of $87.10, reached in March. Over the past three months, shares of FTV have risen 4.4%, which lags behind the Invesco AI and Next Gen Software ETF's (IGPT) rise of 10.1% during the same period.
In the longer term, FTV has gained 4.5% on a YTD basis, underperforming IGPT’s 24% gain. Moreover, shares of Fortive have rallied 6.8% over the past 52 weeks, compared to IGPT’s 27.3% return over the same time frame.
But, FTV stock has been trading above its 50-day and 200-day moving averages since late November.
Fortive has been underperforming due to challenges in key markets like China, delays in government-related spending, and weaker-than-expected performance in its Intelligent Operating Solutions segment. Moreover, despite reporting better-than-expected Q3 adjusted EPS of $0.97, shares of Fortive fell 3.4% on Oct. 30 due to its Q3 revenue of $1.5 billion missing the consensus estimate. Additionally, the Precision Technologies segment saw a slight year-over-year revenue decline and a 70 basis point margin contraction, raising concerns about its future performance. The company's revised full-year revenue guidance of $6.2 billion to $6.3 billion, lower than the consensus estimate, further contributed to investor unease.
However, in comparison with its rival, Cognex Corporation (CGNX) has lagged behind FTV, with a 9.8% dip on a YTD basis and a nearly 10% decrease over the past 52 weeks.
Despite the stock’s outperformance relative to the industry peers, analysts are cautiously optimistic about its prospects. FTV has a consensus rating of “Moderate Buy” from the 17 analysts covering the stock, and it is currently trading below the mean price target of $86.50.
