Value
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 4.3 |
| P/S | 7.2 |
| EV/EBITDA | 1.4 |
| Fwd P/E | 6.5 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 19.7x
- ▸PEG: 0.24
FTV · Why this verdict
Why Fortive (FTV) is rated HOLD
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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VerdictHOLD
Overall score5.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Fortive delivers exceptional free cash flow conversion at 175% of net income and has recovered to two consecutive earnings beats, but technical momentum has weakened — with on-balance volume in a declining trend — and the stock sits just 3.1% below its near-term resistance target with an unfavorable risk/reward, warranting a hold-and-wait posture.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Free cash flow is running at 175% of net income, meaning cash generation substantially exceeds reported earnings — a premium quality indicator backed by a Piotroski F-Score of 8 out of 9. Quality breakdown | Free cash flow to net income ratio stays above 120% over the next four reported quarters, sustaining the premium cash conversion profile. | →Stable |
| CounterThe overall quality dimension score is only moderate, and cash conversion that substantially exceeds net income can sometimes reflect transient working capital changes rather than structurally superior cash generation — if those dynamics reverse, the conversion ratio could normalize lower. | ||
After a large miss and an in-line result in the prior two periods, the company has delivered positive earnings surprises of roughly 7-9% in each of the two most recent quarters — a nascent recovery in execution relative to expectations. Earnings | EPS surprise remains positive for each of the next two reported quarters, confirming the recent recovery in earnings execution is sustained. | ↑Improving |
| CounterThe average quarterly earnings surprise across all four periods is slightly negative due to the earlier large miss, and the improvement in recent beats may reflect analysts lowering estimates after the miss rather than genuine underlying acceleration in results. | ||
On-balance volume is in a declining trend — a sign of net distribution pressure — and momentum is at the floor of the threshold required for a constructive setup, suggesting that buying pressure is not keeping pace with price and that the technical underpinning is fragile. Momentum breakdown | On-balance volume inflects to a rising trend and MACD turns positive, sustained for 4 consecutive weeks, signaling that buying pressure has genuinely recovered. | ↑Improving |
| CounterThe stock remains above its 200-day moving average and momentum is only marginally below the constructive threshold; the distribution signal in on-balance volume may reflect normal profit-taking in an appreciated stock rather than a meaningful shift in the underlying demand-supply balance. | ||
With approximately 3.1% of headroom to the near-term technical resistance and a risk/reward ratio of roughly 0.65-to-1, potential downside to the stop level is meaningfully larger than available upside — a setup that does not justify adding to a position at current levels. Price targets | A pullback to where upside to resistance exceeds 9%, bringing the risk/reward above 1.5-to-1, would restore a constructive entry point. | ↓Deteriorating |
| CounterThe setup is characterized as range-bound with a balanced risk profile, and earnings due in 43 days create a near-term catalyst that could push the stock above resistance if results extend the recent two-quarter beat streak. | ||
Free cash flow is running at 175% of net income, meaning cash generation substantially exceeds reported earnings — a premium quality indicator backed by a Piotroski F-Score of 8 out of 9.
→StableQuality breakdown
- Expectation
- Free cash flow to net income ratio stays above 120% over the next four reported quarters, sustaining the premium cash conversion profile.
CounterThe overall quality dimension score is only moderate, and cash conversion that substantially exceeds net income can sometimes reflect transient working capital changes rather than structurally superior cash generation — if those dynamics reverse, the conversion ratio could normalize lower.
After a large miss and an in-line result in the prior two periods, the company has delivered positive earnings surprises of roughly 7-9% in each of the two most recent quarters — a nascent recovery in execution relative to expectations.
↑ImprovingEarnings
- Expectation
- EPS surprise remains positive for each of the next two reported quarters, confirming the recent recovery in earnings execution is sustained.
CounterThe average quarterly earnings surprise across all four periods is slightly negative due to the earlier large miss, and the improvement in recent beats may reflect analysts lowering estimates after the miss rather than genuine underlying acceleration in results.
On-balance volume is in a declining trend — a sign of net distribution pressure — and momentum is at the floor of the threshold required for a constructive setup, suggesting that buying pressure is not keeping pace with price and that the technical underpinning is fragile.
↑ImprovingMomentum breakdown
- Expectation
- On-balance volume inflects to a rising trend and MACD turns positive, sustained for 4 consecutive weeks, signaling that buying pressure has genuinely recovered.
CounterThe stock remains above its 200-day moving average and momentum is only marginally below the constructive threshold; the distribution signal in on-balance volume may reflect normal profit-taking in an appreciated stock rather than a meaningful shift in the underlying demand-supply balance.
With approximately 3.1% of headroom to the near-term technical resistance and a risk/reward ratio of roughly 0.65-to-1, potential downside to the stop level is meaningfully larger than available upside — a setup that does not justify adding to a position at current levels.
↓DeterioratingPrice targets
- Expectation
- A pullback to where upside to resistance exceeds 9%, bringing the risk/reward above 1.5-to-1, would restore a constructive entry point.
CounterThe setup is characterized as range-bound with a balanced risk profile, and earnings due in 43 days create a near-term catalyst that could push the stock above resistance if results extend the recent two-quarter beat streak.
Per-dimension breakdown
Quality
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.4 |
| ROA | 2.2 |
| Gross margin | 8.6 |
| Op margin | 7.7 |
| Net margin | 6.2 |
| Current ratio | 4.7 |
| FCF quality | 10.0 |
| Moat | 6.5 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 176% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
3.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.5 |
| EPS growth | 2.8 |
Momentum
8.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.6 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 10.0 |
| vol acceleration | 9.1 |
- ▸Overbought (RSI 89)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
- ▸Volume surge (2.5x avg) on up move
Sentiment
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.8 |
| Analyst rating | 5.0 |
| Price target | 4.7 |
Insider
3.9/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 3.8 |
| notable moves | 3.0 |
- ▸Negligible insider selling — $533,493 (0.003% of mkt cap)
Peer rank
3.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.5 |
| quality rank | 4.1 |
| growth rank | 2.9 |
Technical
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 2.4 |
| 52w position | 9.1 |
| gap | 3.0 |
- ▸Extreme gap up (6.0%) - may pull back
Risk (lower is worse)
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.9 |
| days to cover | 2.1 |
| volatility | 6.7 |
| put call | 10.0 |
| implied vol | 5.9 |
| max pain risk | 7.0 |
| beta | 7.1 |
| debt equity | 7.4 |
| news risk | 6.0 |
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| surprise avg | 6.3 |
| dividend safety | 8.0 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
- ▸Dividend aristocrat: 0.5% yield
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +2 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+2Passed (6)
- MOMENTUM:8.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.0=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.00
Upside
-14.8%
Downside
14.8%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.6 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Momentum at 8.6) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.0=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.00 — supplementary context, not the trigger for this path.
The strongest dimensions are Momentum at 8.6, Catalyst at 7.5, and Risk (lower is worse) at 6.5; the weakest are Technical at 3.6, Growth at 3.6, and Peer rank at 3.9. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -1.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Exceptional Cash Flow Quality
Trip ifFree cash flow to net income ratio falls below 100% for 2 consecutive quarters.
- P2Improving Earnings Execution
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P3Weakening Technical Momentum
Trip ifMACD rises above 0 and on-balance volume rises above its prior 4-week average for 4 consecutive weeks.
- P4Limited Upside Current Setup
Trip ifStock price falls to $57.00 or below, creating more than 9% upside to the resistance target.