On Friday, Mizuho (NYSE:MFG) Securities expressed a positive outlook on Fortive Corporation (NYSE: NYSE:FTV), a diversified industrial technology conglomerate with a market capitalization of $27.3 billion, by increasing the price target on the company's shares to $97.00 from the previous $90.00.
The firm reiterated its Outperform rating for the stock, signaling confidence in Fortive's performance, which has delivered an 11.46% return over the past year.Want deeper insights? InvestingPro offers comprehensive research reports for Fortive and 1,400+ other US stocks, transforming complex data into actionable intelligence.
Mizuho's analysts highlighted Fortive's ongoing strategic move to execute a tax-free spin-off of its Precision Technologies segments, a decision aimed at streamlining the company's operations. The analysts noted that Fortive is focusing on share repurchases, indicating a prioritization of returning value to shareholders. InvestingPro data shows the company operates with moderate debt levels and maintains impressive gross profit margins of 59.74%. Additionally, plans for a management transition are in progress, including the roles of CEO and CFO.
According to the analysts at Mizuho, Fortive remains a top pick for investors in 2025, citing a potential for over 30% upside in the share price compared to their Bull Case scenario. The raised price target to $97 is based on an increased implied Sum of the Parts (SOTP) valuation. Furthermore, the upside price target has also been adjusted upward to $101 from the previous $95, reflecting an even more optimistic view of the company's value.
Fortive's strategic decisions, including the shelving of deal ambitions, have been recognized by the analysts as moves that could positively influence the company's financial health and market positioning. The updated price targets suggest that Mizuho analysts see a strong future for Fortive, backed by solid management actions and a clear focus on enhancing shareholder value.
In other recent news, WW Grainger (NYSE:GWW)'s fourth-quarter 2024 earnings per share (EPS) is forecasted to be $9.72, slightly below the consensus estimate of $9.76, according to RBC (TSX:RY) Capital Markets. The firm also predicts a cautious initial 2025 guidance from Grainger, reflecting recent shortfalls in the company's High-Touch Solutions U.S. segment.
On the other hand, Fortive Corporation reported a 14% increase in adjusted EPS and a 12% rise in free cash flow in the third quarter of 2024, with significant contributions from the Advanced Healthcare Solutions and Intelligent Operating Solutions segments. Meanwhile, 3M Company (NYSE:MMM) recorded a 1% organic revenue growth and an 18% rise in non-GAAP earnings per share in the third quarter.
Despite these positive developments, the company faced challenges, including a $3.6 billion legal settlement. In analyst notes, UBS initiated coverage on Fortive Corporation stock with a Neutral rating and a price target of $84.00, while Truist Securities adjusted its outlook on Fortive, reducing the price target to $89 from $90, but maintaining a Buy rating.
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