Fortive Corporation (FTV): history, ownership, mission, how it works & makes money

A Brief History of Fortive Corporation

Company Overview

Fortive Corporation, established in 2016 as a spin-off from Danaher Corporation, operates in the diversified industrial sector. The company focuses on providing essential technologies, software, and services across various industries, including healthcare, manufacturing, and environmental services.

Recent Financial Performance

As of September 27, 2024, Fortive reported total sales of $1.534 billion for the third quarter, reflecting an increase from $1.495 billion in the same quarter of 2023. For the nine-month period ending September 27, 2024, total sales reached $4.612 billion, compared to $4.482 billion in 2023.

Operating Segments

Fortive operates through three main segments: Intelligent Operating Solutions (IOS), Precision Technologies (PT), and Advanced Healthcare Solutions (AHS). As of September 27, 2024, the sales breakdown by segment is as follows:

Acquisitions and Investments

Fortive has pursued a growth strategy through acquisitions. In 2023, the company completed four acquisitions totaling $101.4 million. In 2024, Fortive acquired EA for approximately $1.17 billion, significantly enhancing its technology capabilities.

Stock Performance and Share Repurchase

As of September 27, 2024, Fortive's stock repurchase program authorized the buyback of up to 20 million shares. The company repurchased approximately 3.8 million shares at an average price of $70.87 during the third quarter of 2024.

Financial Position and Debt

As of September 27, 2024, Fortive's total long-term debt stood at $3.872 billion. The company's liquidity is supported by a $2.0 billion revolving credit facility, with no borrowings outstanding under this facility at the reporting date.

Net earnings for the nine-month period ending September 27, 2024, amounted to $624.1 million, with an effective tax rate of 10.2% compared to 15.8% in the prior year.

Outlook and Strategic Initiatives

Fortive aims to continue driving growth through its strategic initiatives, focusing on innovation and operational excellence. The company announced plans to separate into two independent, publicly traded entities, enhancing its focus on core markets and operational efficiencies.

A Who Owns Fortive Corporation (FTV)

Major Shareholders

As of 2024, Fortive Corporation (FTV) has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:

Stock Performance

The stock price of Fortive Corporation has shown significant activity in 2024. As of September 27, 2024, the closing stock price was $70.87, reflecting a year-to-date performance increase of approximately 12.3%. The average daily trading volume is approximately 1.2 million shares.

Dividends and Earnings

Fortive Corporation has consistently paid dividends to its shareholders. In 2024, the company declared quarterly dividends of $0.20 per share, totaling an annual dividend payout of approximately $84 million. The net earnings for the nine months ending September 27, 2024, were reported at $624.1 million, with a net earnings per share (EPS) of $1.78.

Recent Transactions

During 2024, Fortive engaged in a series of transactions affecting its share structure. Notably, the company repurchased approximately 5.8 million shares of its common stock at an average price of $72.78, totaling about $423 million in buybacks.

Financial Overview

The financial health of Fortive Corporation is reflected in its balance sheet as of September 27, 2024. Key financial metrics include:

Market Capitalization

As of September 27, 2024, Fortive Corporation's market capitalization stands at approximately $24.6 billion, based on the current stock price and total outstanding shares.

Outlook

Fortive anticipates revenue growth of approximately 3% for the fourth quarter of 2024, with core revenue growth expected to be around 1%. The company continues to monitor economic conditions and market trends that could impact its performance.

Fortive Corporation (FTV) Mission Statement

Company Overview

Fortive Corporation is a global provider of essential technologies for connected workflows, primarily serving customers in industrial, healthcare, and commercial markets. The company operates through three primary segments: Intelligent Operating Solutions (IOS), Precision Technologies (PT), and Advanced Healthcare Solutions (AHS).

Mission Statement

Fortive's mission statement emphasizes its commitment to delivering "essential technology for the world's most critical challenges." This encompasses a focus on innovation, operational excellence, and customer success across its diverse portfolio of solutions.

Financial Performance Metrics

As of the third quarter of 2024, Fortive reported the following key financial metrics:

Segment Performance

The performance across Fortive's key segments for the third quarter of 2024 is as follows:

Growth Drivers

Fortive's growth has been supported by several key factors:

• Core revenue growth driven by favorable pricing and increased sales volume in strategic product areas such as gas detection and software solutions.
• Acquisitions contributing to revenue growth, accounting for a 1.6% increase in total revenue for Q3 2024 compared to Q3 2023.
• Market expansion in high-growth regions, particularly in Latin America, where revenue increased by high-teens percentages.

Future Outlook

For the fourth quarter of 2024, Fortive anticipates revenue growth of approximately 3% and core revenue growth of about 1%. The company is also preparing for its pending separation into two independent publicly traded companies, which is expected to further refine its strategic focus and operational efficiencies.

Recent Developments

In March 2024, Fortive sold land and office buildings for $90 million, which will support its ongoing investment in innovation and operational improvements. Additionally, the company has executed a discrete restructuring plan aimed at enhancing efficiency and aligning resources with its strategic goals.

How Fortive Corporation (FTV) Works

Business Overview

Fortive Corporation operates through three primary segments: Intelligent Operating Solutions (IOS), Precision Technologies (PT), and Advanced Healthcare Solutions (AHS). As of September 27, 2024, the company reported total sales of $1,534.6 million for the third quarter and $4,611.5 million for the nine months ended.

Financial Performance

Fortive's gross profit for the third quarter of 2024 was $921.3 million, with a gross profit margin of 60.0%. The operating profit margin was reported at 19.3% for the third quarter.

Segment Analysis

The IOS segment provides advanced instrumentation, software, and services. In Q3 2024, IOS achieved sales of $661.2 million, with an operating profit of $167.7 million, representing an operating profit margin of 25.4%.

Precision Technologies Segment

The Precision Technologies segment focuses on electrical test and measurement solutions. In Q3 2024, sales reached $550.9 million, with an operating profit of $122.0 million, reflecting an operating profit margin of 22.1%.

Advanced Healthcare Solutions Segment

The Advanced Healthcare Solutions segment provides critical workflow solutions for healthcare providers. Q3 2024 sales were $322.5 million, with an operating profit of $41.0 million, resulting in an operating profit margin of 12.7%.

Cash Flow and Capital Structure

Fortive's cash flow from operating activities for the nine months ended September 27, 2024, was $624.1 million. The company had a total debt of $3,859.9 million as of September 27, 2024.

Stock Performance

Fortive's diluted earnings per share (EPS) for Q3 2024 was $0.63, compared to $0.61 in Q3 2023. The company declared cash dividends of $0.08 per share for Q3 2024.

How Fortive Corporation (FTV) Makes Money

Revenue Streams

Fortive Corporation generates revenue primarily through three segments: Intelligent Operating Solutions (IOS), Precision Technologies (PT), and Advanced Healthcare Solutions (AHS). For the nine months ended September 27, 2024, total revenue was $4,611.5 million, reflecting a year-over-year increase compared to $4,481.6 million in the same period of 2023.

Cost of Sales and Gross Profit

For the nine months ended September 27, 2024, Fortive reported a cost of sales of $1,857.7 million, leading to a gross profit of $2,753.8 million. This reflects a gross profit margin of 59.7%, slightly up from 59.1% in the prior year.

Operating Expenses

In the nine months ended September 27, 2024, Fortive incurred selling, general, and administrative expenses (SG&A) of $1,610.5 million and research and development (R&D) expenses of $306.9 million.

Operating Profit and Margin

Operating profit for the nine months ended September 27, 2024, was $899.5 million, with an operating profit margin of 19.5%, an increase from 18.4% in the same period of the previous year.

Net Earnings

Net earnings for the nine months ended September 27, 2024, amounted to $624.1 million, compared to $600.6 million for the same period in 2023, with a diluted earnings per share of $1.76.

Geographic Revenue Distribution

For the nine months ended September 27, 2024, Fortive's revenue by geographic location shows significant contributions from the United States and China.

Future Outlook

Fortive anticipates revenue growth of approximately 3% for the fourth quarter of 2024 and the full year, with core revenue growth projected to be approximately 1%.

Article updated on 8 Nov 2024

Resources:

• Fortive Corporation (FTV) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Fortive Corporation (FTV)' financial performance, including balance sheets, income statements, and cash flow statements.
• SEC Filings – View Fortive Corporation (FTV)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.