Thermo Fisher Remains Strong

| About: Thermo Fisher (TMO)


Shares of Thermo Fisher Scientific (NYSE: TMO) - a provider of analytical instruments, reagents and consumables, equipment, services for research, software, manufacture analysis, diagnostics and discovery - showed little change in September, ending the month very near where they started. On a yearly basis, however, share performance was quite different with share prices almost doubling to $92.15 from $57.21. This was accomplished in spite of all the turmoil the healthcare industry has faced in the past year. Thermo Fisher Scientific has been the world's leader in servicing science since 1956. Its growth stems from a pool of services, products and solutions that it provides for analysis, research, diagnostics and discovery. With annual revenues of $13 billion, it continues to create value through its premier brands Fisher Scientific, Thermo Scientific and Unity Lab Services.

Financials Growth

This company's revenue rose 4.2% Y-Y. The stock's 50-day moving average was $91.34, while its 200-day moving average was $85.73. By end-September, cost per share increased by almost $0.30. Sales growth is estimated to increase 3.2% for the year and 3.8% next year.

Overall growth of the company is expected to increase annually by 8.75% annually over the next five years, a substantial decrease from the annual growth rate of 13.83% during the previous five years. Thermo Fisher Scientific is not alone in this projection, as it is estimated that the entire sector will also see a similar decrease. At the same time, the annual growth rate in the sector will still be much higher than Thermo Fisher Scientific's, at least double, in the coming five years.

Thermo Fisher Scientific had revenue of $12.78 billion for the trailing 12 months (June 29, 2013), which translates to $35.52 per share. Its operating cash flow was $1.92 billion and its levered free cash flow was $1.43 billion. The share price also rose 57.03% increase in the past year. At the end of the most recent quarter, its balance sheet showed total cash of $1.42 billion and total debt of $7.11 billion, an unhealthy ratio.


Thermo Fisher Scientific's financial highlights includes revenue valued at $12.78 billion for the trailing twelve months (June 29, 2013). This equals out to $35.52 revenue per share. At the same time, the balance sheet displays total cash at $1.42 billion for the most recent quarter. The total debt is valued at $7.11 billion, which is almost $6 billion higher than the total cash. This displays an unhealthy ratio for TMO. Their operating cash flow is $1.92 billion and their levered free cash flow is $1.43 billion for the trailing twelve months. Also, there has been a 57.03% increase in the stock price for the past 52 weeks.

Thermo Fisher Scientific renewed its agreement with Siemens Healthcare Diagnostics on Sept. 4. The long-term agreement, which covers all countries outside the United States and China, is for the use of Thermo Fisher Scientific's procalcitonin technology (B.R.A.H.M.S PCT (T.M)), technology that is used as an automated immunoassay by Siemens ADVIA Centaur XP and CP systems. Following the renewal, Thermo Fisher Scientific said, "The continuation of our close collaboration with Siemens significantly increases the global reach of this critical biomarker, making it available to a broader patient population." This is one of the highlights for Thermo Fisher Scientific, along with their stock's performance in the last three trading sessions. TMO'S stock largely outperformed the S&P 500 in the same period. TMO saw an increase of 7.01%, while S&P 500 saw an increase of 0.72%. These key advancements allows the company to retain its rating as a strong "buy."

Disclosure: I am long TMO. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.