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Thermo Fisher (TMO) End Market Growth Strong Despite Macro Woes
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Thermo Fisher Scientific (TMO - Free Report) continues to gain from strategic partnerships. Yet, macroeconomic issues dent growth. The company carries a Zacks Rank #3 (Hold) currently.
Within the pharma and biotech end market, of late, Thermo Fisher’s biosciences and bioproduction businesses have significantly expanded their capacity to meet the global vaccine manufacturing requirements. Additionally, the pharma services business has been providing pharma and biotech customers with the services they need to develop and produce vaccines and therapies globally. In the third quarter, within the said end market, the company registered the strongest growth in the pharma services business.
In academic and government, Thermo Fisher is delivering strong growth in electron microscopy, chromatography and mass spectrometry businesses. In the third quarter, this end market showed high single-digit growth. Within the diagnostics and healthcare end-market, the company delivered robust core business growth driven by the immunodiagnostics, microbiology and transplant diagnostics businesses.
Thermo Fisher continues to expand its business, banking on strategic alliances. In October 2023, the company entered into a companion diagnostic (CDx) partnership with Boehringer Ingelheim to support emerging precision therapies and improve patient outcomes by increasing access to reliable genomic testing needed to match patients with targeted cancer treatments. Through this collaboration, the companies will work to develop CDx tests to help identify patients with non-small cell lung cancer with specific genomic mutations.
In September 2023, Thermo Fisher collaborated with the National Minority Quality Forum (NMQF) to help bring clinical research to historically underserved patient populations through NMQF’s Alliance for Representative Clinical Trials. The NMQF and Thermo Fisher's clinical research division will aid in increasing community health clinics' capacity to participate in clinical studies.
However, Thermo Fisher has been experiencing a continuous decline in COVID-19 testing-related demand over the past few quarters. During the first six months of 2023, sales growth in all major regions declined due to decreased demand for COVID-19-related products.
Further, the challenging macroeconomic scenario and slower economic recovery in China continue to hurt Thermo Fisher's growth. The company has been witnessing headwinds in the government and academic markets. Moreover, many countries in Europe are also going through a tough time that might impact their academic budgets. Thermo Fisher remains cautious as growth could further moderate if the economic scenario worsens.
In the third quarter of 2023, Thermo Fisher registered a year-over-year decline in sales in North America and Asia Pacific. Further, China declined in high single digits. Our model estimates the Asia Pacific region to decline 4.6% in 2023.
Estimates for Insulet’s 2023 earnings per share have remained constant at $1.97 in the past 30 days. Shares of the company have lost 30.9% in the past year compared with the industry’s decline of 1.2%.
PODD’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 105.1%. In the last reported quarter, it delivered an average earnings surprise of 77.5%.
Estimates for DaVita’s 2023 earnings per share have remained constant at $8.07 in the past 30 days. Shares of the company have gained 7.4% in the past year compared with the industry’s growth of 2.9%.
DVA’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 36.6%. In the last reported quarter, it delivered an average earnings surprise of 48.4%.
Haemonetics’stock has gained 13.3% in the past year. Earnings estimates for Haemoneticshave remained constant at $3.89 for fiscal 2024 and increased from $4.15 to $4.18 for fiscal 2025 in the past 30 days.
HAE’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.1%. In the last reported quarter, it delivered an earnings surprise of 5.3%.
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Thermo Fisher (TMO) End Market Growth Strong Despite Macro Woes
Thermo Fisher Scientific (TMO - Free Report) continues to gain from strategic partnerships. Yet, macroeconomic issues dent growth. The company carries a Zacks Rank #3 (Hold) currently.
Within the pharma and biotech end market, of late, Thermo Fisher’s biosciences and bioproduction businesses have significantly expanded their capacity to meet the global vaccine manufacturing requirements. Additionally, the pharma services business has been providing pharma and biotech customers with the services they need to develop and produce vaccines and therapies globally. In the third quarter, within the said end market, the company registered the strongest growth in the pharma services business.
In academic and government, Thermo Fisher is delivering strong growth in electron microscopy, chromatography and mass spectrometry businesses. In the third quarter, this end market showed high single-digit growth. Within the diagnostics and healthcare end-market, the company delivered robust core business growth driven by the immunodiagnostics, microbiology and transplant diagnostics businesses.
Thermo Fisher Scientific Inc. Price
Thermo Fisher Scientific Inc. price | Thermo Fisher Scientific Inc. Quote
Thermo Fisher continues to expand its business, banking on strategic alliances. In October 2023, the company entered into a companion diagnostic (CDx) partnership with Boehringer Ingelheim to support emerging precision therapies and improve patient outcomes by increasing access to reliable genomic testing needed to match patients with targeted cancer treatments. Through this collaboration, the companies will work to develop CDx tests to help identify patients with non-small cell lung cancer with specific genomic mutations.
In September 2023, Thermo Fisher collaborated with the National Minority Quality Forum (NMQF) to help bring clinical research to historically underserved patient populations through NMQF’s Alliance for Representative Clinical Trials. The NMQF and Thermo Fisher's clinical research division will aid in increasing community health clinics' capacity to participate in clinical studies.
However, Thermo Fisher has been experiencing a continuous decline in COVID-19 testing-related demand over the past few quarters. During the first six months of 2023, sales growth in all major regions declined due to decreased demand for COVID-19-related products.
Further, the challenging macroeconomic scenario and slower economic recovery in China continue to hurt Thermo Fisher's growth. The company has been witnessing headwinds in the government and academic markets. Moreover, many countries in Europe are also going through a tough time that might impact their academic budgets. Thermo Fisher remains cautious as growth could further moderate if the economic scenario worsens.
In the third quarter of 2023, Thermo Fisher registered a year-over-year decline in sales in North America and Asia Pacific. Further, China declined in high single digits. Our model estimates the Asia Pacific region to decline 4.6% in 2023.
Key Picks
Some better-ranked stocks in the broader medical space are Insulet (PODD - Free Report) , DaVita (DVA - Free Report) and Haemonetics (HAE - Free Report) . Insulet and DaVita sport a Zacks Rank #1 (Strong Buy) each at present, while Haemonetics carries a Zacks Rank #2 (Buy), You can see the complete list of today’s Zacks #1 Rank stocks here.
Estimates for Insulet’s 2023 earnings per share have remained constant at $1.97 in the past 30 days. Shares of the company have lost 30.9% in the past year compared with the industry’s decline of 1.2%.
PODD’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 105.1%. In the last reported quarter, it delivered an average earnings surprise of 77.5%.
Estimates for DaVita’s 2023 earnings per share have remained constant at $8.07 in the past 30 days. Shares of the company have gained 7.4% in the past year compared with the industry’s growth of 2.9%.
DVA’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 36.6%. In the last reported quarter, it delivered an average earnings surprise of 48.4%.
Haemonetics’stock has gained 13.3% in the past year. Earnings estimates for Haemoneticshave remained constant at $3.89 for fiscal 2024 and increased from $4.15 to $4.18 for fiscal 2025 in the past 30 days.
HAE’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 16.1%. In the last reported quarter, it delivered an earnings surprise of 5.3%.