Fortrea Holdings Inc. (FTRE), a provider of contract research and development services for the pharmaceutical and biotechnology industries, saw its stock plummet by 5.29% in the intraday trading session on Wednesday. The significant drop in share price was largely attributed to the company's disappointing fourth-quarter earnings results and weak guidance for the current fiscal year.
According to the earnings report, Fortrea reported a 1.8% year-over-year decline in revenue to $697 million for the fourth quarter, falling short of analysts' expectations by 0.9%. The company also issued full-year revenue guidance that missed analysts' projections, further exacerbating concerns about its future growth prospects.
Analysts highlighted that Fortrea delivered the weakest performance against estimates, slowest revenue growth, and weakest full-year guidance update among its peers in the drug development inputs and services sector. The lackluster results and outlook have raised questions about the company's ability to capitalize on the increasing demand for outsourced drug development services, particularly in the areas of biologics, cell, and gene therapies.
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