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Thermo Fisher Scientific (TMO) Laps the Stock Market: Here's Why

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In the latest market close, Thermo Fisher Scientific (TMO - Free Report) reached $531.65, with a +0.37% movement compared to the previous day. The stock's change was more than the S&P 500's daily gain of 0.14%. At the same time, the Dow added 0.3%, and the tech-heavy Nasdaq gained 0.16%.

Coming into today, shares of the maker of scientific instrument and laboratory supplies had gained 9.01% in the past month. In that same time, the Medical sector gained 4.24%, while the S&P 500 gained 4.89%.

Market participants will be closely following the financial results of Thermo Fisher Scientific in its upcoming release. On that day, Thermo Fisher Scientific is projected to report earnings of $5.64 per share, which would represent year-over-year growth of 4.44%. Simultaneously, our latest consensus estimate expects the revenue to be $10.74 billion, showing a 6.24% drop compared to the year-ago quarter.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $21.52 per share and revenue of $42.71 billion, indicating changes of -7.4% and -4.92%, respectively, compared to the previous year.

Investors should also note any recent changes to analyst estimates for Thermo Fisher Scientific. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Thermo Fisher Scientific is currently sporting a Zacks Rank of #4 (Sell).

Looking at valuation, Thermo Fisher Scientific is presently trading at a Forward P/E ratio of 24.62. This represents a discount compared to its industry's average Forward P/E of 25.1.

One should further note that TMO currently holds a PEG ratio of 3.22. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Medical - Instruments industry currently had an average PEG ratio of 2.6 as of yesterday's close.

The Medical - Instruments industry is part of the Medical sector. Currently, this industry holds a Zacks Industry Rank of 81, positioning it in the top 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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