Fortrea: Turning Around As The Activists Move In

Summary

• Fortrea, a recent Labcorp spin-off, is poised for recovery with strong bookings, industry inflection, and activist interest, despite a 46% stock drop in 2024.
• CEO Thomas Pike's proven track record and the potential January Effect add to Fortrea's upside, targeting a $45 stock price within a year.
• The CRO industry's temporary downturn is reversing, with Fortrea's book-to-bill ratio improving to 1.23x, indicating strong future revenue growth.
• Fortrea's high leverage and ongoing spin-off expenses are concerns, but activist involvement and potential acquisition post-July 2025 offer additional upside.