Fortive Corporation Reports Q4 Results with Better than Expected EPS

Fortive Corporation (NYSE: FTV) concluded the fourth quarter of 2024 with notable achievements in various financial metrics. The company reported a 2% year-over-year increase in revenues, reaching $1.62 billion, which included a 2% growth in core revenue.

This performance was driven by strong demand in its Intelligent Operating Solutions (IOS) and Advanced Healthcare Solutions (AHS) segments. Fortive’s adjusted diluted earnings per share (EPS) for the quarter stood at $1.17, reflecting a 19% increase from the previous year. The company also recorded a significant operating cash flow of $502 million and free cash flow of $465 million, marking a 13% rise year-over-year.

The company’s operating profit for the quarter was $307.1 million, with an operating margin of 19.0%. Fortive’s IOS segment led the way with an operating profit of $199.6 million and an operating margin of 28.1%. The AHS segment also showed improvement, with an operating profit of $46.9 million and an operating margin of 13.7%. However, the Precision Technologies (PT) segment experienced a decline in operating profit to $113.6 million, with a reduced operating margin of 20.0%.

Fortive Reports Fourth-Quarter Results with Better than Expected Results

Fortive’s fourth-quarter results surpassed market expectations, particularly in terms of adjusted EPS. The consensus forecast for EPS was $1.12, while Fortive achieved $1.17, exceeding expectations by $0.05. However, the company’s revenue of $1.62 billion fell slightly short of the anticipated $1.63 billion.

This minor shortfall was offset by the strong performance in profitability and cash flow metrics, which provided a positive outlook for investors. The company’s core revenue growth of 1.8% for the quarter was a testament to its strategic focus on innovation and operational efficiency.

While the PT segment faced some headwinds, the overall growth in the IOS and AHS segments highlighted Fortive’s diversified business model. The company’s ability to achieve record margins and cash flow despite mixed market conditions demonstrated its commitment to delivering value to shareholders.

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Fortive Expects Adjusted Diluted EPS Between $0.83 and $0.86

Fortive has set optimistic guidance for both the first quarter and the full year. For the first quarter, the company anticipates revenues in the range of $1.48 billion to $1.51 billion, with diluted EPS projected between $0.39 and $0.42.

The adjusted diluted EPS for the first quarter is expected to be between $0.83 and $0.86. Fortive’s full-year forecast includes revenues of approximately $6.23 billion to $6.35 billion, with diluted EPS ranging from $2.38 to $2.50. The adjusted diluted EPS for the year is projected to be between $4.00 and $4.12.Fortive’s 2025 guidance reflects its strategic initiatives to drive growth and enhance profitability.

The pending separation of the PT segment, expected to be completed by early Q3 2025, is anticipated to further streamline operations and unlock value for shareholders. Fortive remains committed to executing its growth strategy while maintaining a strong financial position.

Fortive’s strategic initiatives in 2025 are centered around enhancing its portfolio and driving sustainable growth. The company plans to leverage its Fortive Business System to optimize operations and capitalize on market opportunities.

The separation of the PT segment into an independent publicly traded company, Ralliant, is a key component of this strategy. This move is expected to allow Fortive to focus on its core segments, IOS and AHS, and enable Ralliant to pursue growth opportunities in precision instruments and engineered products. CEO James A. Lico expressed confidence in Fortive’s ability to deliver consistent results and create value for stakeholders.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.