LH - Fortrea Holdings: Still Many Question Marks On This CRO Play
2024-05-12 18:00:00 ET
Summary
- Fortrea Holdings, a CRO business spun off from LabCorp, has seen a decline in shares due to concerns about flattish sales and lack of earnings.
- The company has announced a divestment to reduce leverage, but lack of underlying profitability remains a major concern.
- Despite modest growth in revenues and a strong backlog, the company's lack of real profitability makes me cautious here.
In November, I concluded that Fortrea Holdings ( FTRE ) announced a very mixed bag of third quarter results. The CRO business, which has been spun off from LabCorp ( LH ) , had seen shares fall from the high-thirties to mid-twenties as investors were concerned about flattish sales and declining earnings. This caused a real overhang on the shares as the company employed quite some leverage as well....
Fortrea Holdings: Still Many Question Marks On This CRO Play