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Fortive (FTV) Q2 Earnings & Revenues Beat Estimates, Up Y/Y
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Fortive Corporation (FTV - Free Report) reported second-quarter 2022 adjusted earnings of 78 cents per share, outpacing the Zacks Consensus Estimate by 8.3%. The figure also increased 18.2% year over year.
Revenues increased 10.9% year over year to $1.46 billion and beat the Zacks Consensus Estimate by 3.6%. Also, core revenues moved up 8.9% from the year-ago quarter’s levels.
Fortive Corporation Price, Consensus and EPS Surprise
The top line was driven by strong customer demand, especially in North America and Western Europe. However, this was partly offset by persistent supply-chain troubles and the reimposition of lockdown in certain parts of the world. Hardware backlog was up by 21% for the year-to-date period.
In the past year, shares of Fortive have lost 9.5% compared with the industry’s decline of 18.1%.
Image Source: Zacks Investment Research
Top Line in Detail
Fortive operates under the following three organized segments.
Intelligent Operating Solutions: The segment generated revenues of $630 million (contributing 43.1% to total second-quarter revenues), up 16.3% on a year-over-year basis.
Precision Technologies: This segment generated revenues of $499 million (34.1% of total revenues), up 5.8% from the prior-year quarter’s levels.
Advanced Healthcare Solutions: This segment generated revenues of $334 million (22.8% of total revenues), increasing 9.2% from the prior-year quarter’s levels.
Operating Details
In the quarter under review, the adjusted gross margin came in at 57%, which contracted 30 basis points (bps) year over year.
Total operating expenses were $601.2 million, up 10.5% year over year. As a percentage of revenues, selling, general & administrative expenses were 33.1%, contracted 145 bps year over year. Research & development costs, as a percentage of revenues, expanded 19 bps year over year to 6.8%.
Adjusted operating margin was 24.1%, expanding 190 bps on a year-over-year basis.
Segment-wise, the adjusted operating margin from Intelligent Operating Solutions came in at 28.8%, which expanded 30 bps year over year.
Precision Technologies’ adjusted operating margins of 23.8% expanded 90 bps year over year. Advanced Healthcare Solutions’ adjusted operating margins of 23.1% rose 300 bps.
Balance Sheet & Cash Flow
As of Jul 1, 2022, cash and cash equivalents were $682.9 million compared with $684.3 million on Mar 31, 2022.
Accounts receivables were $940.9 million in the reported quarter compared with $929 million in the prior quarter.
The company generated an operating cash flow of $294.4 million compared with $214.8 million reported in the previous quarter.
Free cash flow came in at $276 million compared with $196 million in the prior quarter.
Guidance
For third-quarter 2022, management expects adjusted net earnings in the range of 74-77 cents per share. The corresponding Zacks Consensus Estimate for the quarter is pegged at 78 cents per share.
Revenues are projected in the range of $1.430-$1.455 billion. The corresponding Zacks Consensus Estimate for the quarter is pegged at $1.45 billion. For the quarter, the company expects the adjusted operating margin to be around 23.8%. Free cash flow is expected to be $300 million.
For 2022, Fortive expects adjusted net earnings in the range of $3.07-$3.13 per share. The Zacks Consensus Estimate for the same is pegged at $3.05 per share.
Revenues are projected in the range of $5.775-$5.825 billion compared with the earlier guidance of $5.765-$5.875 billion. The corresponding Zacks Consensus Estimate for the same is pegged at $5.77 billion.
For 2022, the company expects an adjusted operating margin to be around 24.1%. Free cash flow is expected to be around $1.17 billion.
The Zacks Consensus Estimate for Aspen Technology’s 2022 earnings is pegged at $5.49 per share, increasing 0.4% in the past 60 days. The long-term earnings growth rate is anticipated to be 16.3%.
Aspen Technology’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 4.1%. Shares of AZPN have soared 34.2% in the past year.
The Zacks Consensus Estimate for Synopsys 2022 earnings is pegged at $8.67 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 19.6%.
Synopsys earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 2.7%. Shares of SNPS have jumped 27% in the past year.
The Zacks Consensus Estimate for InterDigital’s 2022 earnings is pegged at $2.76 per share, declining 15.9% in the past 60 days. The long-term earnings growth rate is anticipated to be 15%.
InterDigital’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 141.1%. Shares of IDCC have declined 7.3% in the past year.
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Fortive (FTV) Q2 Earnings & Revenues Beat Estimates, Up Y/Y
Fortive Corporation (FTV - Free Report) reported second-quarter 2022 adjusted earnings of 78 cents per share, outpacing the Zacks Consensus Estimate by 8.3%. The figure also increased 18.2% year over year.
Revenues increased 10.9% year over year to $1.46 billion and beat the Zacks Consensus Estimate by 3.6%. Also, core revenues moved up 8.9% from the year-ago quarter’s levels.
Fortive Corporation Price, Consensus and EPS Surprise
Fortive Corporation price-consensus-eps-surprise-chart | Fortive Corporation Quote
The top line was driven by strong customer demand, especially in North America and Western Europe. However, this was partly offset by persistent supply-chain troubles and the reimposition of lockdown in certain parts of the world. Hardware backlog was up by 21% for the year-to-date period.
In the past year, shares of Fortive have lost 9.5% compared with the industry’s decline of 18.1%.
Image Source: Zacks Investment Research
Top Line in Detail
Fortive operates under the following three organized segments.
Intelligent Operating Solutions: The segment generated revenues of $630 million (contributing 43.1% to total second-quarter revenues), up 16.3% on a year-over-year basis.
Precision Technologies: This segment generated revenues of $499 million (34.1% of total revenues), up 5.8% from the prior-year quarter’s levels.
Advanced Healthcare Solutions: This segment generated revenues of $334 million (22.8% of total revenues), increasing 9.2% from the prior-year quarter’s levels.
Operating Details
In the quarter under review, the adjusted gross margin came in at 57%, which contracted 30 basis points (bps) year over year.
Total operating expenses were $601.2 million, up 10.5% year over year. As a percentage of revenues, selling, general & administrative expenses were 33.1%, contracted 145 bps year over year. Research & development costs, as a percentage of revenues, expanded 19 bps year over year to 6.8%.
Adjusted operating margin was 24.1%, expanding 190 bps on a year-over-year basis.
Segment-wise, the adjusted operating margin from Intelligent Operating Solutions came in at 28.8%, which expanded 30 bps year over year.
Precision Technologies’ adjusted operating margins of 23.8% expanded 90 bps year over year. Advanced Healthcare Solutions’ adjusted operating margins of 23.1% rose 300 bps.
Balance Sheet & Cash Flow
As of Jul 1, 2022, cash and cash equivalents were $682.9 million compared with $684.3 million on Mar 31, 2022.
Accounts receivables were $940.9 million in the reported quarter compared with $929 million in the prior quarter.
The company generated an operating cash flow of $294.4 million compared with $214.8 million reported in the previous quarter.
Free cash flow came in at $276 million compared with $196 million in the prior quarter.
Guidance
For third-quarter 2022, management expects adjusted net earnings in the range of 74-77 cents per share. The corresponding Zacks Consensus Estimate for the quarter is pegged at 78 cents per share.
Revenues are projected in the range of $1.430-$1.455 billion. The corresponding Zacks Consensus Estimate for the quarter is pegged at $1.45 billion. For the quarter, the company expects the adjusted operating margin to be around 23.8%. Free cash flow is expected to be $300 million.
For 2022, Fortive expects adjusted net earnings in the range of $3.07-$3.13 per share. The Zacks Consensus Estimate for the same is pegged at $3.05 per share.
Revenues are projected in the range of $5.775-$5.825 billion compared with the earlier guidance of $5.765-$5.875 billion. The corresponding Zacks Consensus Estimate for the same is pegged at $5.77 billion.
For 2022, the company expects an adjusted operating margin to be around 24.1%. Free cash flow is expected to be around $1.17 billion.
Zacks Rank & Stocks to Consider
Currently, Fortive has a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader technology space are Aspen Technology (AZPN - Free Report) , Synopsys (SNPS - Free Report) and InterDigital Inc. (IDCC - Free Report) . Aspen Technology, Synopsys and InterDigital each carry a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Aspen Technology’s 2022 earnings is pegged at $5.49 per share, increasing 0.4% in the past 60 days. The long-term earnings growth rate is anticipated to be 16.3%.
Aspen Technology’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 4.1%. Shares of AZPN have soared 34.2% in the past year.
The Zacks Consensus Estimate for Synopsys 2022 earnings is pegged at $8.67 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 19.6%.
Synopsys earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 2.7%. Shares of SNPS have jumped 27% in the past year.
The Zacks Consensus Estimate for InterDigital’s 2022 earnings is pegged at $2.76 per share, declining 15.9% in the past 60 days. The long-term earnings growth rate is anticipated to be 15%.
InterDigital’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 141.1%. Shares of IDCC have declined 7.3% in the past year.