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Thermo Fisher (TMO)
NYSE:TMO
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Thermo Fisher
(NYSE:TMO)70Outperform
Positive Factors
Earnings Growth
The deal is expected to be accretive to earnings per share by excluding financing costs, showing potential for long-term financial benefits.
Strategic Acquisition
The acquisition of SOLV's Purification and Filtration business is expected to bolster Thermo Fisher Scientific's position in bioprocessing.
Negative Factors
Short-term Financial Impact
The acquisition is expected to be dilutive to earnings per share in the first year, indicating a potential short-term financial drawback.
Thermo Fisher (TMO) vs. S&P 500 (SPY)
Market Cap
$194.88B
Dividend Yield0.3%
Average Volume (3M)2.02M
Price to Earnings (P/E)31.2
Beta (1Y)0.75
Revenue Growth0.05%
EPS Growth6.87%
CountryUS
Employees122,000
SectorHealthcare
Sector Strength74
IndustryMedical Diagnostics & Screening
Share Statistics
EPS (TTM)16.52
Shares Outstanding377,261,170
10 Day Avg. Volume1,889,242
30 Day Avg. Volume2,023,630
Financial Highlights & Ratios
PEG Ratio4.55
Price to Book (P/B)N/A
Price to Sales (P/S)4.61
Price to Cash Flow (P/CF)15.00
P/FCF Ratio15.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$662.00Price Target Upside28.15% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering18
Thermo Fisher Business Overview & Revenue Model
Company DescriptionThermo Fisher Scientific Inc. (TMO) is a global leader in serving science, offering a comprehensive range of products and services to various industries, including healthcare, pharmaceuticals, biotechnology, and academia. The company operates in four primary segments: Life Sciences Solutions, Analytical Instruments, Specialty Diagnostics, and Laboratory Products and Biopharma Services. Thermo Fisher's core products and services include laboratory equipment, reagents, consumables, software, and services that enable scientific research, drug discovery, diagnostics, and manufacturing.
How the Company Makes MoneyThermo Fisher makes money through the sale of a diverse array of products and services across its four main business segments. The Life Sciences Solutions segment generates revenue by providing reagents, instruments, and consumables used in biological and medical research. The Analytical Instruments segment earns income from selling precision scientific instruments and software for laboratory use. The Specialty Diagnostics segment focuses on diagnostic kits, reagents, and instruments for clinical and research applications, contributing significantly to the company's revenue. The Laboratory Products and Biopharma Services segment offers laboratory equipment, supplies, and biopharmaceutical services, including contract manufacturing and clinical trial support. Thermo Fisher's earnings are bolstered by strategic partnerships with leading pharmaceutical and biotechnology companies, as well as its global presence, which helps it capture a broad customer base and leverage economies of scale.
Thermo Fisher Financial Statement Overview
Summary
Thermo Fisher is in a strong financial position with high profitability, solid equity, and robust cash flows. Despite slowing revenue growth and rising debt levels, the company maintains strong margins and cash generation.Income Statement
Thermo Fisher demonstrates strong profitability with a consistently high gross profit margin and improving EBIT margin over time. The net profit margin is robust, suggesting effective cost management. However, the revenue growth rate has slightly declined recently, indicating potential market saturation or competitive pressures.85
Very Positive
Balance Sheet
The company maintains a solid equity position, with a moderate debt-to-equity ratio indicating manageable leverage. Return on Equity has been stable, reflecting strong shareholder returns. Yet, the increase in debt over time could pose future financial risks if not managed carefully.78
Positive
Cash Flow
Thermo Fisher shows strong cash flow generation with a positive free cash flow trajectory and a healthy operating cash flow to net income ratio. The free cash flow to net income ratio remains robust, though capital expenditures have been increasing, which may affect future cash reserves.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 42.88B | 42.86B | 44.91B | 39.21B | 32.22B | Gross Profit |
| 18.11B | 17.11B | 19.50B | 20.23B | 16.50B | EBIT |
| 7.34B | 6.86B | 8.39B | 10.03B | 7.79B | EBITDA |
| 11.54B | 11.08B | 11.94B | 12.96B | 10.19B | Net Income Common Stockholders |
| 6.33B | 6.00B | 6.95B | 7.72B | 6.38B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 5.57B | 8.08B | 8.52B | 4.48B | 10.32B | Total Assets |
| 97.32B | 98.73B | 97.15B | 95.12B | 69.05B | Total Debt |
| 31.27B | 34.92B | 34.49B | 34.87B | 21.73B | Net Debt |
| 27.27B | 26.84B | 25.96B | 30.39B | 11.41B | Total Liabilities |
| 47.65B | 51.88B | 53.01B | 54.15B | 34.53B | Stockholders Equity |
| 49.55B | 46.73B | 43.98B | 40.79B | 34.51B |
| Cash Flow | Free Cash Flow | |||
| 7.27B | 6.93B | 6.91B | 7.02B | 6.82B | Operating Cash Flow |
| 8.67B | 8.41B | 9.15B | 9.54B | 8.29B | Investing Cash Flow |
| -5.84B | -5.14B | -2.16B | -21.93B | -1.51B | Financing Cash Flow |
| -6.79B | -3.62B | -2.81B | 6.58B | 959.00M |
Thermo Fisher Technical Analysis
Negative
516.57
Price Trends
547.56
Negative
548.18
Negative
567.24
Negative
Market Momentum
-9.53
Positive
35.66
Neutral
23.71
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TMO, the sentiment is Negative. The current price of 516.57 is below the 20-day moving average (MA) of 541.64, below the 50-day MA of 547.56, and below the 200-day MA of 567.24, indicating a bearish trend. The MACD of -9.53 indicates Positive momentum. The RSI at 35.66 is Neutral, neither overbought nor oversold. The STOCH value of 23.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TMO.
Thermo Fisher Risk Analysis
Thermo Fisher disclosed 26 risk factors in its most recent earnings report. Thermo Fisher reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Thermo Fisher Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
70 Outperform | $194.88B | 31.23 | 12.78% | 0.30% | 0.05% | 6.87% | |
68 Neutral | $36.49B | 29.38 | 20.89% | 0.76% | -3.00% | 3.67% | |
68 Neutral | $26.62B | 31.31 | -680.23% | ― | 2.22% | 12.78% | |
65 Neutral | $147.01B | 38.89 | 7.87% | 0.53% | -13.50% | -17.25% | |
63 Neutral | $22.42B | 34.70 | 34.88% | ― | 0.07% | -1.20% | |
49 Neutral | $7.05B | 0.34 | -55.09% | 2.46% | 25.27% | -3.43% | |
48 Neutral | $7.11B | ― | -28.07% | ― | -3.92% | -202.80% |
* Healthcare Sector Average
Performance Comparison
TMO
Thermo Fisher
516.57
-66.45
-11.40%
A
Agilent
123.06
-20.30
-14.16%
BIO
Bio-Rad Laboratories
250.50
-80.44
-24.31%
DHR
Danaher
205.91
-47.39
-18.71%
MTD
Mettler-Toledo
1,240.97
-45.93
-3.57%
WAT
Waters
368.05
24.64
7.18%
Thermo Fisher Earnings Call Summary
Earnings Call Date: Jan 30, 2025 | % Change Since: -9.09% | Next Earnings Date: Apr 23, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong finish to 2024 with significant revenue and earnings growth, positive customer feedback, and successful innovation and capital deployment. However, there are some challenges with declines in pharma and biotech, and diagnostics and healthcare segments for the full year, as well as potential policy uncertainties.Highlights
Q4 Revenue and Earnings Growth
Q4 revenue grew 5% year-over-year to $11.4 billion. Adjusted operating income grew 7% to $2.72 billion, and adjusted EPS increased 8% to $6.10 per share.
Strong Performance Across Segments
All end markets showed positive revenue growth in Q4, with pharma and biotech growing mid-single digits, academic and government high-single digits, industrial and applied high-single digits, and diagnostics and healthcare low single-digits.
Successful Capital Deployment
Returned $4.6 billion to shareholders through stock buybacks and dividends in 2024, including $1 billion of shares repurchased in Q4.
High-Impact Innovation
Launched several new products, including the Thermo Scientific Stellar mass spectrometer and Thermo Scientific Dionex Inuvion ion chromatography system.
Positive Customer Feedback and Partnerships
Strong positive feedback from customers on the Accelerator Drug Development solution and new partnerships, including with the National Cancer Institute and the University of Arkansas for Medical Sciences.
Lowlights
Pharma and Biotech Full Year Decline
For the full year, pharma and biotech declined in the low single digits, impacted by a mid-single-digit headwind from the runoff of vaccine and therapy-related revenue.
Diagnostics and Healthcare Full Year Decline
Diagnostics and healthcare declined low-single digits for the full year due to the runoff of COVID-19 testing-related revenue.
Uncertain Policy Environment
Potential impacts from future policy changes, tariffs, NIH funding, and export controls create some uncertainty moving forward.
Company Guidance
During the fourth quarter earnings call for 2024, Thermo Fisher Scientific provided guidance for 2025, forecasting revenue between $43.5 billion and $44 billion, reflecting a 3% to 4% organic growth. Adjusted earnings per share (EPS) are anticipated to grow by 6% to 8%, reaching between $23.10 and $23.50, supported by a projected adjusted operating margin expansion of 90 basis points. The company reported strong performance across its segments, with notable growth in Analytical Instruments and Specialty Diagnostics, and an overall 5% year-over-year revenue increase to $11.4 billion in Q4. Despite challenges like the pandemic runoff impacting growth, the company highlighted strategic initiatives such as high-impact innovation and the launch of new products. Thermo Fisher also emphasized its disciplined capital deployment strategy, returning $4.6 billion to shareholders in 2024 through buybacks and dividends. Looking ahead, the company remains optimistic about market conditions improving throughout 2025, aiming to leverage its proven growth strategy and commercial execution to drive continued success.Thermo Fisher Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Thermo Fisher Expands Board with Healthcare Executive
Positive
Feb 19, 2025
On February 19, 2025, Thermo Fisher Scientific Inc. expanded its board of directors to include Karen S. Lynch, a seasoned healthcare executive with extensive experience at companies like CVS Health, Aetna, and Cigna. This strategic appointment is expected to bolster the company’s industry positioning, particularly in healthcare solutions, as Lynch brings a wealth of knowledge and leadership experience that could influence Thermo Fisher’s operations and impact its stakeholders positively.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.