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Thermo Fisher Scientific, Inc. TMO is rapidly boosting its inorganic growth profile through strategic acquisitions. Its strong focus on emerging markets is also encouraging. The stock has a Zacks Rank #2 (Buy).
Thermo Fisher has outperformed its industry in the past year. The stock has risen 12.1% against the industry’s 10.3% fall.
Thermo Fisher ended the third quarter of 2021 with better-than-expected numbers. The company delivered a strong quarterly performance, leveraging on a significant rebound in its base business. The company’s Life Sciences Solutions, Analytical Instruments, Specialty Diagnostics, and Laboratory Products and Services all recorded year-over-year growth in the reported quarter. In the quarter, Thermo Fisher generated $2.05 billion in COVID-19 response-related revenues. With the surge in the Delta variant, the company saw strong testing demand globally.
It has also played a meaningful role in vaccines and therapies for COVID 19, generating just over $500 million in the last-reported quarter in this space. In terms of end market, the company noted that market conditions were strong and accordingly performance was good in the third quarter. The raised 2021 guidance too buoys optimism about this strong growth momentum, which is expected to continue through the rest of the year.
Thermo Fisher Scientific Inc. Price
Thermo Fisher Scientific Inc. price | Thermo Fisher Scientific Inc. Quote
Thermo Fisher is currently expanding its bioproduction purification resin capacity, which is used in the mRNA manufacturing process. In the third quarter of 2021, the company opened a bioprocesses design center in South Korea. This center will help pharma and biotech customers advance their important work. In addition, as part of the company’s previously-announced strategic partnership with CSL Limited, Thermo Fisher assumed operating responsibility for its new state-of-the-art biologics site in Lengnau, Switzerland. The site will feature highly flexible bioproduction technologies, including single-use and stainless steel to provide a pathway from development to large-scale production as customers' needs evolve. To support growing demand in the biopharmaceutical industry, the company announced plans to open a new bar production facility in Nashville, TN to manufacture single-use technologies.
Thermo Fisher boasts strong international operations and has witnessed consistent growth in high-growth and emerging markets. In the quarter under review, Europe grew over 20%, the Asia Pacific grew in low double digits while China grew in low single digits. In the third quarter of 2021, in China, the company registered strong COVID response revenues, with new orders occupying about 10% of the quarter’s growth. The company plans to continue to strengthen its foothold in emerging markets, such as China and India, and to translate this success to other high-priority opportunities in regions such as South Korea, Russia and Brazil.