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Fortive (FTV) Gears Up for Q2 Earnings: What's in the Cards?

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Fortive Corporation (FTV - Free Report) is slated to report second-quarter 2019 results on Jul 25.

The company topped the Zacks Consensus Estimate in three of the trailing four quarters, recording average positive surprise of 1.82%.

In the last reported quarter, Fortive delivered a positive earnings surprise of 1.47%. First-quarter earnings of 69 cents per share decreased 11.5% from the year-ago period.

Robust product portfolio, solid momentum across all its platforms and benefits from acquisitions are likely to drive the upcoming results. However, end-market cyclicality and higher expenses might impact earnings.

For second-quarter 2019, Fortive anticipates adjusted net earnings between 86 cents and 90 cents per share. The Zacks Consensus Estimate for earnings per share is pegged at 89 cents.

Further, the Zacks Consensus Estimate for revenues is pegged at $1.93 billion.

Let’s see how things are shaping up for the upcoming quarterly results.

Fortive Corporation Price and EPS Surprise

 

Acquisitions & Portfolio Strength — Key Catalysts

Fortive’s strong endeavors toward innovation and expansion of key offerings on the back of strong and accretive acquisitions will likely drive top-line growth in the quarter to be reported.

During the second quarter, the company completed the acquisition of Advanced Sterilization Products (“ASP”) from Johnson & Johnson’s (JNJ) subsidiary, Ethicon, Inc., for approximately $2.7 billion. The ASP deal should help the company to expand its product portfolio and aid the upcoming results.

Also, the company’s acquisitions of eMaint, Orpak, Landauer and Industrial Scientific, which aided the expansion of Fortive’s product portfolio, are expected to drive core revenues in the to-be-reported quarter.

However, higher expenses incurred on these acquisitions and integration issues may impact the upcoming quarterly results.

The Zacks Consensus Estimate for revenues from Professional Instrumentation and Industrial Technologies segments for the to-be-reported quarter is pegged at $1.2 billion and $734 million, respectively.

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) along with a positive Earnings ESP has a good chance of beating estimates. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Fortive currently has a Zacks Rank #4 and an Earnings ESP of +0.64%. Hence, our proven model indicates that the company is unlikely to beat estimates in the second quarter.

Stocks That Warrant a Look

Here are a few stocks worth considering as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

Amazon.com, Inc. (AMZN - Free Report) has an Earnings ESP of +15.56% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Facebook, Inc. (FB - Free Report) has an Earnings ESP of +0.61% and a Zacks Rank #2.

Thermo Fisher Scientific Inc. (TMO - Free Report) has an Earnings ESP of +0.54% and holds a Zacks Rank #3.

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