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Zacks Industry Outlook Highlights: Mettler-Toledo International, PerkinElmer and Bruker Corp
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For Immediate Release
Chicago, IL – June 1, 2021 – Today, Zacks Equity Research discusses Scientific Instruments including Mettler-Toledo International Inc. (MTD - Free Report) , PerkinElmer, Inc. and Bruker Corporation (BRKR - Free Report) .
The coronavirus pandemic has created unique opportunities for the Zacks Instruments - Scientific industry participants — Mettler-Toledo International, PerkinElmer and Bruker Corp.
These companies are gaining from solid demand for coronavirus testing tools as well as rising instrument orders across the globe. Moreover, increasing spending on health care driven by an aging demography and continued innovation in the pharma and life sciences end-markets are key catalysts despite coronavirus-induced macroeconomic uncertainties.
Further, the reopening of university research laboratories as well as applied and industrial labs globally is a driving factor for the near term.
Industry Description
The Zacks Instruments - Scientific industry comprises companies offering scientific instruments, analytical tools, diagnostic solutions, precision instruments & services, and test & sensor solutions.
The primary end-markets served by the industry participants are life science research in academia, medical schools and government, pharmaceuticals and biotechnology, microbiology and diagnostics, nanotechnology, and materials science research. A few companies also serve the food and nutritional safety, biochemical, and industrial spaces.
Most of the industry participants are under stringent regulatory scrutiny worldwide. They have to adhere to the U.S. Food and Drug Administration (FDA) norms as well as rules set by other global regulatory bodies for serving highly regulated end-markets like life sciences and pharma.
3 Trends Shaping the Future of Instruments-Scientific Industry
Strong End-Market Demand: The industry is benefiting from strong end-market demand, particularly from the life science, pharmaceutical and academic markets. Increasing demand for generic drugs and biosimilars is driving growth for scientific tool and apparatus providers.
Additionally, pharma companies are focusing on rapidly growing areas like proteomics and phenomics, biopharma and applied, microbiology and diagnostics, and neuroscience and cell microscopy, which creates significant demand for the instruments provided by industry participants.
Aging Demography Driving Spending: Socioeconomic factors like an aging demography and increasing environmental regulations are driving demand for scientific measurement solutions. Moreover, robust worldwide healthcare spending is a major growth driver.
Notably, for fiscal 2021, Congress approved roughly a 3% increase in funding for the National Institutes of Health (NIH), which now stands at $42.9 billion. For fiscal 2022, the proposed budget is $51 billion for NIH.
Solid Emerging Market Prospects: Further, the industry is gaining from increasing exposure to developing economies like China and India. Prospects in China are huge as regulators are attempting to raise the country's biopharma industry to global standards. Moreover, efforts to improve the drug development process and production quality in the country are noteworthy. These factors are resulting in strong demand for instruments.
Zacks Industry Rank Indicates Solid Prospects
The Zacks Instruments - Scientific industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #75, which places it at the top 30% of more than 250 Zacks industries.
The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates solid near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1.
The industry's positioning in the top 50% of the Zacks-ranked industries is a result of positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gaining confidence in this group's earnings growth potential. Since Jan 31, the industry's 2021 earnings estimates have moved up 11.4%.
Before we present a few stocks that you may want to consider for your portfolio, let's take a look at the industry's recent stock-market performance and valuation picture.
Industry Beats Sector and S&P 500
The Zacks Instruments – Scientific industry has outperformed the broader Zacks Computer and Technology sector and the S&P 500 composite over the past year.
The industry has risen 56.2% over this period compared with the S&P 500's increase of 40.8% and the broader sector's rally of 51.9%.
Industry's Current Valuation
On the basis of forward 12-month P/E, which is a commonly used multiple for valuing scientific instrument stocks, we see that the industry is currently trading at 27.98X compared with the S&P 500's 21.86X and the Zacks Computer and Technology sector's 27.22X.
Over the last five years, the industry has traded as high as 28.55X, as low as 20.12X and at the median of 23.78X.
3 Scientific Instruments Providers to Watch
Bruker Corp.: This Billerica, MA-headquartered company is benefiting from robust acceptance of its GHz-class systems. Strength in Bruker's microbiology and molecular diagnostics revenues is also encouraging. Launch of this Zacks Rank #2 (Buy) company's next generation, high-performance 80 MHz Fourier Transform Nuclear Magnetic Resonance (FT-NMR) benchtop spectrometer is impressive.
Markedly, Bruker's BioSpin products, which have specific application in structural proteomics, drug discovery, research and food and materials science fields, provide customers with the ability to ascertain the structure, dynamics, and function of specific molecules, such as proteins, as well as characterize and determine the composition of mixtures.
Moreover, demand for the MALDI Biotyper is increasing in applied markets, specifically for food, feed and beverage. Additionally, Bruker is poised to double its microbiology business over the next four to five years. Given an increase in the aging population, a higher number of individuals are likely to fall prey to illnesses, especially those caused by microorganisms.
Notably, the Zacks Consensus Estimate for its 2021 earnings has risen 4.5% to $1.85 per share in the past 30 days. The stock has rallied 28.3% on a year-to-date basis.
PerkinElmer: This Waltham, MA-headquartered company is riding on an expanding product portfolio and growing global exposure. Markedly, this Zacks Rank #3 (Hold) company delivers a comprehensive suite of scientific informatics and software solutions to aggregate data into actionable insights in an automated and scalable way.
Moreover, the acquisition of Oxford Immunotec will enable the company to expand its portfolio of advanced infectious disease testing solutions by including the tuberculosis detection product line. Additionally, this month, PerkinElmer inked a deal to acquire Nexcelom Bioscience for an amount of $260 million in cash. The buyout is anticipated to get completed during the second quarter of 2021.
PerkinElmer's shares have returned 1% year to date. The Zacks Consensus Estimate for its current-year earnings has been revised 8.1% north to $9.30 per share over the past 30 days.
Mettler-Toledo International: This Columbus, OH-domiciled company has returned 13.8% year to date. This Zacks Rank #3 company continues to see solid momentum across its Laboratory, Industrial and Food Retail segments.
Moreover, growing momentum in China is a tailwind. The company's portfolio strength, cost-cutting efforts, robust sales, marketing strategies, and margin and productivity initiatives are expected to continue aiding its performance. Further, benefits from strategic investments in Spinnaker sales remain a positive.
Moreover, the Zacks Consensus Estimate for the company's current-year earnings has moved 4.3% north to $31.05 per share over the past 30 days.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Industry Outlook Highlights: Mettler-Toledo International, PerkinElmer and Bruker Corp
For Immediate Release
Chicago, IL – June 1, 2021 – Today, Zacks Equity Research discusses Scientific Instruments including Mettler-Toledo International Inc. (MTD - Free Report) , PerkinElmer, Inc. and Bruker Corporation (BRKR - Free Report) .
Link: https://www.zacks.com/commentary/1618997/3-stocks-to-watch-on-rising-demand-for-scientific-instruments
The coronavirus pandemic has created unique opportunities for the Zacks Instruments - Scientific industry participants — Mettler-Toledo International, PerkinElmer and Bruker Corp.
These companies are gaining from solid demand for coronavirus testing tools as well as rising instrument orders across the globe. Moreover, increasing spending on health care driven by an aging demography and continued innovation in the pharma and life sciences end-markets are key catalysts despite coronavirus-induced macroeconomic uncertainties.
Further, the reopening of university research laboratories as well as applied and industrial labs globally is a driving factor for the near term.
Industry Description
The Zacks Instruments - Scientific industry comprises companies offering scientific instruments, analytical tools, diagnostic solutions, precision instruments & services, and test & sensor solutions.
The primary end-markets served by the industry participants are life science research in academia, medical schools and government, pharmaceuticals and biotechnology, microbiology and diagnostics, nanotechnology, and materials science research. A few companies also serve the food and nutritional safety, biochemical, and industrial spaces.
Most of the industry participants are under stringent regulatory scrutiny worldwide. They have to adhere to the U.S. Food and Drug Administration (FDA) norms as well as rules set by other global regulatory bodies for serving highly regulated end-markets like life sciences and pharma.
3 Trends Shaping the Future of Instruments-Scientific Industry
Strong End-Market Demand: The industry is benefiting from strong end-market demand, particularly from the life science, pharmaceutical and academic markets. Increasing demand for generic drugs and biosimilars is driving growth for scientific tool and apparatus providers.
Additionally, pharma companies are focusing on rapidly growing areas like proteomics and phenomics, biopharma and applied, microbiology and diagnostics, and neuroscience and cell microscopy, which creates significant demand for the instruments provided by industry participants.
Aging Demography Driving Spending: Socioeconomic factors like an aging demography and increasing environmental regulations are driving demand for scientific measurement solutions. Moreover, robust worldwide healthcare spending is a major growth driver.
Notably, for fiscal 2021, Congress approved roughly a 3% increase in funding for the National Institutes of Health (NIH), which now stands at $42.9 billion. For fiscal 2022, the proposed budget is $51 billion for NIH.
Solid Emerging Market Prospects: Further, the industry is gaining from increasing exposure to developing economies like China and India. Prospects in China are huge as regulators are attempting to raise the country's biopharma industry to global standards. Moreover, efforts to improve the drug development process and production quality in the country are noteworthy. These factors are resulting in strong demand for instruments.
Zacks Industry Rank Indicates Solid Prospects
The Zacks Instruments - Scientific industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #75, which places it at the top 30% of more than 250 Zacks industries.
The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates solid near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1.
The industry's positioning in the top 50% of the Zacks-ranked industries is a result of positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gaining confidence in this group's earnings growth potential. Since Jan 31, the industry's 2021 earnings estimates have moved up 11.4%.
Before we present a few stocks that you may want to consider for your portfolio, let's take a look at the industry's recent stock-market performance and valuation picture.
Industry Beats Sector and S&P 500
The Zacks Instruments – Scientific industry has outperformed the broader Zacks Computer and Technology sector and the S&P 500 composite over the past year.
The industry has risen 56.2% over this period compared with the S&P 500's increase of 40.8% and the broader sector's rally of 51.9%.
Industry's Current Valuation
On the basis of forward 12-month P/E, which is a commonly used multiple for valuing scientific instrument stocks, we see that the industry is currently trading at 27.98X compared with the S&P 500's 21.86X and the Zacks Computer and Technology sector's 27.22X.
Over the last five years, the industry has traded as high as 28.55X, as low as 20.12X and at the median of 23.78X.
3 Scientific Instruments Providers to Watch
Bruker Corp.: This Billerica, MA-headquartered company is benefiting from robust acceptance of its GHz-class systems. Strength in Bruker's microbiology and molecular diagnostics revenues is also encouraging. Launch of this Zacks Rank #2 (Buy) company's next generation, high-performance 80 MHz Fourier Transform Nuclear Magnetic Resonance (FT-NMR) benchtop spectrometer is impressive.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Markedly, Bruker's BioSpin products, which have specific application in structural proteomics, drug discovery, research and food and materials science fields, provide customers with the ability to ascertain the structure, dynamics, and function of specific molecules, such as proteins, as well as characterize and determine the composition of mixtures.
Moreover, demand for the MALDI Biotyper is increasing in applied markets, specifically for food, feed and beverage. Additionally, Bruker is poised to double its microbiology business over the next four to five years. Given an increase in the aging population, a higher number of individuals are likely to fall prey to illnesses, especially those caused by microorganisms.
Notably, the Zacks Consensus Estimate for its 2021 earnings has risen 4.5% to $1.85 per share in the past 30 days. The stock has rallied 28.3% on a year-to-date basis.
PerkinElmer: This Waltham, MA-headquartered company is riding on an expanding product portfolio and growing global exposure. Markedly, this Zacks Rank #3 (Hold) company delivers a comprehensive suite of scientific informatics and software solutions to aggregate data into actionable insights in an automated and scalable way.
Moreover, the acquisition of Oxford Immunotec will enable the company to expand its portfolio of advanced infectious disease testing solutions by including the tuberculosis detection product line. Additionally, this month, PerkinElmer inked a deal to acquire Nexcelom Bioscience for an amount of $260 million in cash. The buyout is anticipated to get completed during the second quarter of 2021.
PerkinElmer's shares have returned 1% year to date. The Zacks Consensus Estimate for its current-year earnings has been revised 8.1% north to $9.30 per share over the past 30 days.
Mettler-Toledo International: This Columbus, OH-domiciled company has returned 13.8% year to date. This Zacks Rank #3 company continues to see solid momentum across its Laboratory, Industrial and Food Retail segments.
Moreover, growing momentum in China is a tailwind. The company's portfolio strength, cost-cutting efforts, robust sales, marketing strategies, and margin and productivity initiatives are expected to continue aiding its performance. Further, benefits from strategic investments in Spinnaker sales remain a positive.
Moreover, the Zacks Consensus Estimate for the company's current-year earnings has moved 4.3% north to $31.05 per share over the past 30 days.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.