Curreen Capital’s Investment Thesis for Fortrea Holdings Inc (FTRE)

Investment management company Curreen Capital released its second-quarter 2025 Investor letter. A copy of the letter can be downloaded here. In the second quarter, Curreen Capital was up 14.07% vs. 10.94% for the S&P 500 and 11.55% for the MSCI World (US Gross). The quarter started with stock price declines driven by tariffs, especially affecting small companies. The firm’s policy remains: a) avoid predicting market moves and responding foolishly, and b) concentrate on valuing current and potential investments. Please review the fund’s top 5 holdings to gain insight into their key selections for 2025.

In its second quarter 2025 investor letter, Curreen Capital highlighted stocks such as Fortrea Holdings Inc. (NASDAQ:FTRE). Fortrea Holdings Inc. (NASDAQ:FTRE) is a contract research organization. The one-month return of Fortrea Holdings Inc. (NASDAQ:FTRE) was 31.86%, and its shares lost 75.36% of their value over the last 52 weeks. On July 28, 2025, Fortrea Holdings Inc. (NASDAQ:FTRE) stock closed at $6.87 per share, with a market capitalization of $622.012 million.

Curreen Capital stated the following regarding Fortrea Holdings Inc. (NASDAQ:FTRE) in its second quarter 2025 investor letter:

“We primarily deployed the proceeds from selling Nilorn into Havas in the first quarter and into Fortrea Holdings Inc. (NASDAQ:FTRE) during the second quarter.

So… what is Fortrea? Fortrea is a contract research organization (CRO), which means they run clinical trials to test treatments that pharmaceutical companies are trying to get approved for use in patients. I have been following Fortrea since it spun out of Labcorp in June 2023. Back then, Fortrea seemed like an exciting, fast growing business earning good returns on capital, with a star CEO who had a reputation for running (and selling) a similar business. Things have fallen apart since then…

Compared to the exciting period after COVID, fervor for new drug research has declined. Less money has flowed to biotech companies, who hire CROs to help run the clinical trials they need in order to market their therapies. In addition to this industry-wide headwind, Fortrea has gone through the expensive process of setting up its own IT systems and operations separate from Labcorp. Fortrea also has a decent amount of debt, which is common in spinoffs. All in, this once exciting business ran into an industry slowdown, increased spending on stand-up costs, and still had all that debt to deal with. Earnings turned to losses, the stock price dropped and kept dropping, and as of mid-May the star CEO was out…” (Click here to read the full text)

An executive team in a boardroom discussing the launch of a new drug trial.

Fortrea Holdings Inc. (NASDAQ:FTRE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 41 hedge fund portfolios held Fortrea Holdings Inc. (NASDAQ:FTRE) at the end of the first quarter, which was 38 in the previous quarter. Fortrea Holdings Inc.’s (NASDAQ:FTRE) first quarter revenue declined 1.6% year-over-year to $651.3 million. While we acknowledge the risk and potential of Fortrea Holdings Inc. (NASDAQ:FTRE) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Fortrea Holdings Inc. (NASDAQ:FTRE) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Fortrea Holdings Inc. (NASDAQ:FTRE) and shared the list of best low priced pharma stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.