A favorable report is a committee's recommendation to the House and Senate that the bill be passed.
When a bill gets a favorable report from a committee, the next stop is the Legislative Commissioners' Office (LCO) to be redrafted and then the House and Senate.
If a bill gets a favorable report, it is not a guarantee that the bill will pass. Only about half of favorably reported bills become law.
A favorably reported bill may also have to be referred to another committee. For instance, bills that require any funding must stop off in Appropriations before going to the floor.