Value
5.7/10data confidence 83%| Component | Sub-score |
|---|---|
| P/S | 9.7 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 5.6 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 22.9x
- ▸PEG: 0.34
FTRE · Why this verdict
Why Fortrea Holdings (FTRE) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score4.9/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The top ten customers account for 57.0% of revenue and the top 20 for 69.0%, so the loss or reduction of a few sponsors would hit results hard. Bear case | Customer concentration does not rise and the top ten share declines below 55%. | ↑Improving |
| CounterResearch contracts with large sponsors are multi-year and sticky, so concentration reflects long-standing relationships rather than imminent churn. | ||
Revenue is declining about 4%, with quarterly revenue of $678.2M versus $710.3M a year earlier. Growth breakdown | Quarterly revenue grows year over year to above $710M within 12 months. | →Stable |
| CounterSequential revenue rose from $636.5M to $678.2M and the next-quarter estimate is $671.5M, so the decline may be bottoming. | ||
At $23.63 the stock trades 20.1% above the $18.89 analyst target, so analysts see no upside and 15% downside to the stop level. Upside pct | Analysts raise targets above the current price as earnings recover. | →Stable |
| CounterThe stock is above its 200-day average with a golden-cross-style momentum score of 6.7 and rising volume, suggesting buyers see turnaround value that targets have not caught up to. | ||
Insiders sold about $4.26M of stock across 8 sales in 90 days with no purchases. Insider | Insider selling slows to below $1M per quarter. | →Stable |
| CounterSales after a rally to an overbought RSI of 72 may be routine profit-taking by holders rather than a negative view of the turnaround. | ||
EPS beat twice and missed twice in the last four quarters, with the latest two beating ($0.23 versus $0.18 and $0.16 versus $0.05) after earlier misses. Last 4 quarters | EPS beats consensus in at least three of the next four quarters. | ↑Improving |
| CounterQuality scores 1.5 out of 10 and the earlier misses ($0.09 versus $0.16 and $0.12 versus $0.16) show estimate errors cut both ways. | ||
The top ten customers account for 57.0% of revenue and the top 20 for 69.0%, so the loss or reduction of a few sponsors would hit results hard.
↑ImprovingBear case
- Expectation
- Customer concentration does not rise and the top ten share declines below 55%.
CounterResearch contracts with large sponsors are multi-year and sticky, so concentration reflects long-standing relationships rather than imminent churn.
Revenue is declining about 4%, with quarterly revenue of $678.2M versus $710.3M a year earlier.
→StableGrowth breakdown
- Expectation
- Quarterly revenue grows year over year to above $710M within 12 months.
CounterSequential revenue rose from $636.5M to $678.2M and the next-quarter estimate is $671.5M, so the decline may be bottoming.
At $23.63 the stock trades 20.1% above the $18.89 analyst target, so analysts see no upside and 15% downside to the stop level.
→StableUpside pct
- Expectation
- Analysts raise targets above the current price as earnings recover.
CounterThe stock is above its 200-day average with a golden-cross-style momentum score of 6.7 and rising volume, suggesting buyers see turnaround value that targets have not caught up to.
Insiders sold about $4.26M of stock across 8 sales in 90 days with no purchases.
→StableInsider
- Expectation
- Insider selling slows to below $1M per quarter.
CounterSales after a rally to an overbought RSI of 72 may be routine profit-taking by holders rather than a negative view of the turnaround.
EPS beat twice and missed twice in the last four quarters, with the latest two beating ($0.23 versus $0.18 and $0.16 versus $0.05) after earlier misses.
↑ImprovingLast 4 quarters
- Expectation
- EPS beats consensus in at least three of the next four quarters.
CounterQuality scores 1.5 out of 10 and the earlier misses ($0.09 versus $0.16 and $0.12 versus $0.16) show estimate errors cut both ways.
Per-dimension breakdown
Quality
1.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.4 |
| Gross margin | 0.0 |
| Op margin | 1.0 |
| Net margin | 0.0 |
| Current ratio | 3.8 |
| Moat | 2.5 |
| Piotroski F | 4.4 |
- ▸No competitive moat
- ▸Quality concerns
Growth
5.7/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 1.4 |
| EPS growth | 10.0 |
- ▸Declining revenue: -4%
Momentum
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.6 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 8.9 |
- ▸Overbought (RSI 88)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 7.2 |
| Analyst rating | 7.1 |
| Price target | 2.8 |
- ▸LLM news sentiment: +0.44 (n=3)
- ▸Below analyst target
Insider
3.6/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.9 |
- ▸Notable insider selling — $4,260,284 (0.173% of mkt cap)
Peer rank
4.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 9.9 |
| quality rank | 5.7 |
| growth rank | 3.3 |
Technical
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.4 |
| 52w position | 9.8 |
Risk (lower is worse)
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.3 |
| days to cover | 6.3 |
| volatility | 1.0 |
| put call | 10.0 |
| implied vol | 0.0 |
| beta | 3.6 |
| debt equity | 2.9 |
- ▸High IV: 109%
- ▸Concentration risks: 2 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| surprise avg | 10.0 |
| news activity | 8.0 |
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (5)
- MOMENTUM:8.3>=5.5
- INSIDER:OK
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.8=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-1.80
Upside
-27.0%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilitySpeculative — Binary industry: Biotechnology
Investment implication
The SELL_IF_HOLDING verdict reflects the ASYMMETRY gate's -1.8=NEGATIVE outcome against Momentum at 8.3 and asymmetric R:R of -1.80.
The strongest dimensions are Momentum at 8.3, Catalyst at 7.2, and Sentiment at 5.8; the weakest are Quality at 1.5, Technical at 3.4, and Insider at 3.6. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -1.80 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Customer Concentration Risk
Trip ifTop ten customer share rises above 65% of revenue from the current 57.0%.
- P2Declining Revenue
Trip ifYear-over-year revenue growth exceeds 3% for 2 consecutive quarters.
- P3Price Above Analyst Target
Trip ifAnalyst target rises above $25.99, at least 10% above the current $23.63 price.
- P4Heavy Insider Selling
Trip ifInsider sales total more than $8M over 90 days from the current $4.26M.
- P5Inconsistent Earnings Record
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.