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Fortive (FTV) Commences Public Offering of $1 Billion Stock

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Fortive Corporation (FTV - Free Report) has commenced an underwriting public offering of $1 billion common shares to enhance its liquidity profile.

Further, Fortive plans to grant underwriters with a 30-day option for purchasing up to an additional $150,000 common shares to cover any over-allotments. The offering is subject to customary closing conditions.

Net proceeds from the offering will be used to fund Fortive’s acquisition activities for general corporate purposes, including repayment of debts, working capital and capital expenditures.

Morgan Stanley & Co. LLC, UBS Investment Bank and BofA Merrill Lynch are acting as joint book-running managers for the offering.

The enhanced capital deployment reflects Micron’s strong balance sheet as well as confidence in long-term business prospects. During the last reported quarter, Fortive generated $140 million of free cash flow, reflecting an increase of 15%.

Coming to share price, Fortive’s shares have returned 18.68% over a year, outperforming the industry’s growth of 9.60%.

Bottom Line

It is worth mentioning that Fortive’s recent proposal to acquire Advanced Sterilization Products (“ASP”) from Johnson & Johnson’s subsidiary, Ethicon will help it to foray into the rapidly growing infection control market.

Per the data from Markets and Markets, this market is expected to grow at a CAGR of 6.5% between 2017 and 2022, and reach 21.06 billion by 2022 from $15.35 billion in 2017. We believe Fortive is well poised to gain from the market potential.

In addition, Fortive is positive about the product launches and growing demand. In the last reported quarter, Fortive’s revenues declined 3.9% sequentially but surged 13.7% year over year to $1.74 billion.

We believe the company’s strong product portfolio, improved performance in end markets, strengthening Fortive Business System and acquisitions will continue to drive top-line growth.

Fortive Corporation Price and Consensus

 

Fortive Corporation Price and Consensus | Fortive Corporation Quote

Zacks Rank & Other Stocks to Consider

Currently, Fortive carries a Zacks Rank #2 (Buy). Some other stocks worth considering in the same industry are Groupon (GRPN - Free Report) , PetMed Express (PETS - Free Report) and Expedia (EXPE - Free Report) . While Groupon sports a Zacks Rank #1 (Strong Buy), PetMed and Expedia both hold a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth for Groupon, PetMed and Expedia is currently projected to be 6.5%, 10% and 14.5%, respectively.

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