Fortive's (FTV) Q2 Earnings and Revenues Beat Estimates
Fortive Corporation FTV reported second-quarter 2020 earnings of 68 cents per share, which outpaced the Zacks Consensus Estimate of 58 cents. The figure decreased 24.4% from the year-ago quarter but increased 8.1% on a sequential basis.
Revenues decreased 15.7% year over year and 8.3% sequentially to $1.57 billion. Also, core revenues declined 16.8% from the year-ago quarter.
However, the top line outpaced the Zacks Consensus Estimate by 2.9%.
Fortive Corporation Price, Consensus and EPS Surprise
Top Line in Detail
Fortive operates under the following two organized segments.
Professional Instrumentation: The segment generated revenues of $1.03 billion (accounting for 66% of total second-quarter revenues), which decreased 11% on a year-over-year basis.
Industrial Technologies: This segment generated revenues of $533.7 million (34% of total revenues), which declined 23.7% from the prior-year quarter.
In the second quarter, gross margin came in at 51.8%, which expanded 330 basis points (bps) year over year.
Total operating expenses were $623.2 million, reflecting a 4.8% year-over-year decrease. As a percentage of revenues, both selling, general & administrative expenses as well as research & development costs increased from the year-ago quarter.
Operating margin was 12.2%, which contracted 120 bps on a year-over-year basis.
Segment wise, operating margin from Professional Instrumentation came in at 13.1%, which expanded 200 bps year over year.
Industrial Technologies operating margins came in at 15.5% versus 20.7% in the year-ago quarter.
Though the company did not provide full guidance for the third quarter, it expects total revenues to decline 5-8% on a year-over-year basis. The projection, however, indicates a sequential improvement.
Zacks Rank & Other Key Picks
Fortive currently has a Zacks Rank #2 (Buy). Other top-ranked stocks in the broader technology sector include Microchip Technology Incorporated MCHP, eBay EBAY and Advanced Micro Devices, Inc. AMD. While Microchip Technology and eBay sport a Zacks Rank #1 (Strong Buy), Advanced Micro carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth for Microchip Technology, eBay, and Advanced Micro is currently projected at 14.5%, 11.7% and 40.3%, respectively.
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