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What's in Store for Thermo Fisher (TMO) in Q1 Earnings?
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Thermo Fisher Scientific Inc. (TMO - Free Report) is slated to release first-quarter 2023 results on Apr 26, 2023 before market open.
In the last reported quarter, Thermo Fisher’s earnings of $5.40 per share exceeded the Zacks Consensus Estimate by 4%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.96%.
Let's discuss the factors that are likely to get reflected in the upcoming results.
Factors at Play
Similar to the last reported quarter, Thermo Fisher’s Analytical Instruments segment is expected to have generated strong sales, banking on electron microscopy, chromatography, mass spectrometry, chemical analysis and research and safety market channel businesses.
The company is expected to have recorded growth, driven by a favorable business mix and new launches. TMO launched the Gibco CTS DynaCellect Magnetic Separation System aiding customers to advance their cell and gene therapy programs. These are all expected to have contributed to the first-quarter top line.
However, the industry-wide trend of record-level inflation, supply issues and staffing shortages are expected to have deterred growth in several areas within this business.
Within the Life-Science Solutions segment, the company is expected to have registered growth in its bioproduction business, banking on progress with cell culture media, single-use technologies and rapidly-growing purification resin and pharma services businesses.
In terms of performance in high-growth and emerging markets, the company has made major investments in bioproduction of late. During the fourth quarter, the company opened a new CGMP biologics and sterile manufacturing facility in Hangzhou, China. The facility provides integrated clinical and commercial drug substance and drug product capabilities to help customers deliver patient therapies more quickly in China and the Asia Pacific region. It also expanded its bioproduction purification resin capacity with the opening of new manufacturing sites in China and Singapore to enhance the capacity for single-use technology. These developments are expected to have contributed to the company’s revenues in Q1.
Thermo Fisher Scientific Inc. Price and EPS Surprise
This might have been offset by lower revenues in the genetic sciences business due to a moderation in COVID testing revenues compared to the year-ago period.
The Specialty Diagnostics segment (Clinical Diagnostics business from the molecular controls that go into testing kits) is expected to have registered positive contributions in the form of continued growth in the microbiology and transplant diagnostics businesses. In the fourth quarter, Thermo Fisher’s SeCore CDx HLA sequencing system was granted marketing authorization by the FDA for use as a companion diagnostic with a T cell receptive therapy for adults with ocular melanoma. Additionally, the company has expanded its PCR test menu with the launch of the TruMark Infectious Disease Research Panels for rapid detection and research of infectious disease pathogens in January 2023.
Furthermore, Thermo Fisher Partners with AstraZeneca to Develop Solid Tissue and Blood-Based Companion Diagnostic Test for Tagrisso. Through ongoing collaboration, new companion diagnostic (CDx) aims to deliver next-generation sequencing results in as little as 24 hours to help advance precision oncology. We believe this partnership will have significant contribution to the company’s to-be reported quarter performance.
Within the Laboratory Products and Services segment, the company is expected to have gained from strong productivity and volume leverage within the pharma services business and the research and safety market channel. Also, the PPD business in the research and safety market channel as well as plastics used in testing workflows and cold storage equipment manufactured by the lab products business are expected to have generated strong sales growth in the first quarter.
Thermo Fisher’s recent collaboration with Celltrio to bring a fully-automated cell culture system to biotherapeutics customers is expected to have positively contributed to first-quarter performance.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter total revenues is pegged at $10.57 billion, suggesting a 10.6% decline from the prior-year quarter’s reported figure. The consensus mark for earnings is pegged at $4.95 per share, indicating a 31.7% decline from the year-ago quarter’s reported figure.
What Our Quantitative Model Predicts
Per our proven model, stocks with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) have a good chance of beating estimates. This is not the case as you can see:
Earnings ESP: Thermo Fisher has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
Bio-Rad has a 2023 expected earnings growth rate of 10.3%. BIO’s earnings yield of 3.38% compares favorably with the industry’s (2.78%).
Henry Schein, Inc. (HSIC - Free Report) has an Earnings ESP of +0.99% and a Zacks Rank of #1. Henry Schien is expected to release first-quarter fiscal 2023 results on May 2.
HSIC’s earnings surpassed estimates in three of the trailing four quarters and matched the same in the other, the average beat being 2.9%. HSIC’s 2024 growth rate is estimated at 7.7%.
Teva Pharmaceutical Industries Limited (TEVA - Free Report) currently has an Earnings ESP of +14.97% and a Zacks Rank of #2. TEVA is expected to release first-quarter 2023 results on May 2.
TEVA’s 2024 growth rate is estimated at 4.4%. TEVA’s earnings yield of 25.50% compares favorably with the industry’s (34.35%).
Image: Bigstock
What's in Store for Thermo Fisher (TMO) in Q1 Earnings?
Thermo Fisher Scientific Inc. (TMO - Free Report) is slated to release first-quarter 2023 results on Apr 26, 2023 before market open.
In the last reported quarter, Thermo Fisher’s earnings of $5.40 per share exceeded the Zacks Consensus Estimate by 4%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.96%.
Let's discuss the factors that are likely to get reflected in the upcoming results.
Factors at Play
Similar to the last reported quarter, Thermo Fisher’s Analytical Instruments segment is expected to have generated strong sales, banking on electron microscopy, chromatography, mass spectrometry, chemical analysis and research and safety market channel businesses.
The company is expected to have recorded growth, driven by a favorable business mix and new launches. TMO launched the Gibco CTS DynaCellect Magnetic Separation System aiding customers to advance their cell and gene therapy programs. These are all expected to have contributed to the first-quarter top line.
However, the industry-wide trend of record-level inflation, supply issues and staffing shortages are expected to have deterred growth in several areas within this business.
Within the Life-Science Solutions segment, the company is expected to have registered growth in its bioproduction business, banking on progress with cell culture media, single-use technologies and rapidly-growing purification resin and pharma services businesses.
In terms of performance in high-growth and emerging markets, the company has made major investments in bioproduction of late. During the fourth quarter, the company opened a new CGMP biologics and sterile manufacturing facility in Hangzhou, China. The facility provides integrated clinical and commercial drug substance and drug product capabilities to help customers deliver patient therapies more quickly in China and the Asia Pacific region. It also expanded its bioproduction purification resin capacity with the opening of new manufacturing sites in China and Singapore to enhance the capacity for single-use technology. These developments are expected to have contributed to the company’s revenues in Q1.
Thermo Fisher Scientific Inc. Price and EPS Surprise
Thermo Fisher Scientific Inc. price-eps-surprise | Thermo Fisher Scientific Inc. Quote
This might have been offset by lower revenues in the genetic sciences business due to a moderation in COVID testing revenues compared to the year-ago period.
The Specialty Diagnostics segment (Clinical Diagnostics business from the molecular controls that go into testing kits) is expected to have registered positive contributions in the form of continued growth in the microbiology and transplant diagnostics businesses. In the fourth quarter, Thermo Fisher’s SeCore CDx HLA sequencing system was granted marketing authorization by the FDA for use as a companion diagnostic with a T cell receptive therapy for adults with ocular melanoma. Additionally, the company has expanded its PCR test menu with the launch of the TruMark Infectious Disease Research Panels for rapid detection and research of infectious disease pathogens in January 2023.
Furthermore, Thermo Fisher Partners with AstraZeneca to Develop Solid Tissue and Blood-Based Companion Diagnostic Test for Tagrisso. Through ongoing collaboration, new companion diagnostic (CDx) aims to deliver next-generation sequencing results in as little as 24 hours to help advance precision oncology. We believe this partnership will have significant contribution to the company’s to-be reported quarter performance.
Within the Laboratory Products and Services segment, the company is expected to have gained from strong productivity and volume leverage within the pharma services business and the research and safety market channel. Also, the PPD business in the research and safety market channel as well as plastics used in testing workflows and cold storage equipment manufactured by the lab products business are expected to have generated strong sales growth in the first quarter.
Thermo Fisher’s recent collaboration with Celltrio to bring a fully-automated cell culture system to biotherapeutics customers is expected to have positively contributed to first-quarter performance.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter total revenues is pegged at $10.57 billion, suggesting a 10.6% decline from the prior-year quarter’s reported figure. The consensus mark for earnings is pegged at $4.95 per share, indicating a 31.7% decline from the year-ago quarter’s reported figure.
What Our Quantitative Model Predicts
Per our proven model, stocks with the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) have a good chance of beating estimates. This is not the case as you can see:
Earnings ESP: Thermo Fisher has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks Worth a Look
Here are some medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
Bio-Rad Laboratories (BIO - Free Report) has an Earnings ESP of +0.16% and a Zacks Rank of #1. The company is slated to release first-quarter 2023 results on May 4. You can see the complete list of today’s Zacks #1 Rank stocks here.
Bio-Rad has a 2023 expected earnings growth rate of 10.3%. BIO’s earnings yield of 3.38% compares favorably with the industry’s (2.78%).
Henry Schein, Inc. (HSIC - Free Report) has an Earnings ESP of +0.99% and a Zacks Rank of #1. Henry Schien is expected to release first-quarter fiscal 2023 results on May 2.
HSIC’s earnings surpassed estimates in three of the trailing four quarters and matched the same in the other, the average beat being 2.9%. HSIC’s 2024 growth rate is estimated at 7.7%.
Teva Pharmaceutical Industries Limited (TEVA - Free Report) currently has an Earnings ESP of +14.97% and a Zacks Rank of #2. TEVA is expected to release first-quarter 2023 results on May 2.
TEVA’s 2024 growth rate is estimated at 4.4%. TEVA’s earnings yield of 25.50% compares favorably with the industry’s (34.35%).
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.