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Thermo Fisher (TMO) New Facility to Advance Lab Products Supply

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Thermo Fisher Scientific Inc. (TMO - Free Report) recently announced the selection of a new manufacturing facility in Mebane, NC, to boost the domestic supply of critically needed laboratory plastics.

The new manufacturing facility is part of a recently announced co-investment with the U.S. government. Under it, a $192.5-million contract, in coordination with the U.S. Department of Health and Human Services (HHS), was given to Thermo Fisher to ensure domestic supply of critically needed laboratory pipette tips.

With the selection of a new manufacturing facility, Thermo Fisher continues to expand its footprint in North Carolina, strengthening the state's global reputation as a leading location for life sciences companies.

More on the New Facility

Thermo Fisher currently has nearly 4,000 employees across seven sites in North Carolina. With the opening of a new Mebane site, the company is expected to create 150-200 additional jobs in manufacturing, engineering and business operations.

The North Carolina site provides companies like Thermo Fisher a diverse life science workforce and world-class universities and community colleges that keep building workforce day after day. With its strategic geographic location and proximity to a diverse talent base, Mebane is an ideal location for Thermo Fisher’s new facility.

Significance of the New Facility

Thermo Fisher's new manufacturing Mebane facility is part of a larger strategy to develop flexible and redundant production capacity in the United States and across key regions globally. Increased output from recent site expansions will help the company meet the ongoing demand for COVID-related consumables, including plastics used to collect samples and transport them to labs as well as vital equipment used to accelerate production and enable flexibility for both COVID and non-COVID vaccines and therapies.

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A new facility in Mebane will help open up more job opportunities for highly skilled employees and will have a major impact on the lives of the citizens.

Industry Prospects

Per a report by Grand View Research, the global laboratory supplies market size was valued at $30.6 billion in 2020 and is expected to see a CAGR of 7.5% by 2028.

Increasing funding and investment in research & development activities in the field of biotechnology and pharmaceutical are driving the market.

Recent Developments

In November 2021, Thermo Fisher announced a new IVD system that allows assay developers and clinical laboratories to boost molecular diagnostics growth. The Applied Biosystems QuantStudio 7 Pro Dx Real-Time PCR System is a compact instrument that easily transitions from development to validation for maximum productivity.

In the same month, Thermo Fisher announced that biopharmaceutical laboratories working across R&D, manufacturing and quality control (QC) environments can now simplify biopharmaceutical characterization, process monitoring and release testing using a new seamless, built-for-purpose multi-attribute method (MAM) workflow.

Price Performance

Shares of the company have gained 40.6% in a year’s time compared with the industry’s rise of 15.3%.

Zacks Rank and Other Key Picks

Thermo Fisher currently carries a Zacks Rank #2 (Buy).

A few other top-ranked stocks from the broader medical space are Chemed Corporation (CHE - Free Report) , Laboratory Corporation of America Holdings, or LabCorp (LH - Free Report) and Medpace Holdings, Inc. (MEDP - Free Report) .

Chemed has a long-term earnings growth rate of 7.7%. The company surpassed earnings estimates in three of the trailing four quarters and missed in one, delivering a surprise of 5.6%, on average. Chemed currently carries a Zacks Rank #2.

Chemed has outperformed its industry over the past year. CHE has gained 3.7% against a 35.6% industry decline.

LabCorp reported third-quarter 2021 adjusted earnings per share (EPS) of $6.82, which surpassed the Zacks Consensus Estimate by 42.9%. Revenues of $4.06 billion outpaced the Zacks Consensus Estimate by 13.4%. It currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

LabCorp has an estimated long-term growth rate of 10.6%. LH surpassed estimates in the trailing four quarters, the average surprise being 25.7%.

Medpace reported third-quarter 2021 adjusted EPS of $1.29, surpassing the Zacks Consensus Estimate by 20.6%. Revenues of $295.57 million beat the Zacks Consensus Estimate by 1.2%. Medpace currently carries a Zacks Rank #1.

Medpace has an estimated long-term growth rate of 16.4%. MEDP surpassed estimates in the trailing four quarters, the average surprise being 11.9%.