Fortive Will Perform Consistently Even As Macro Slows Into 2023: Analyst

Fortive Corp’s FTV stock valuation is “undemanding,” while the company faces lower macro risk to earnings, according to Morgan Stanley.

The Fortive Analyst: Joshua Pokrzywinski upgraded the rating for Fortive from Equal Weight to Overweight, while raising the price target from $68 to $73.

The Fortive Thesis: The company has exhibited more consistent execution, and has a resilient portfolio mix with industry-leading cash generation, Pokrzywinski said in the upgrade note.

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“Fortive continues to build the recurring revenue exposure within its portfolio, which now stands at ~40%,” the analyst wrote. The company has consistently achieved margin expansion and improved its free cash flow profile since the spin-off, he added.

“With several quarters of more consistent results, improved growth at Accruent (>20% growth in 2Q software bookings and accelerating into 2H), and soundly better cash than other industrials, we see FTV as a quality franchise with durable performance as macro slows into next year,” Pokrzywinski further mentioned.

FTV Price Action: Shares of Fortive were trading 1.73% higher on Wednesday at $60.10.

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