Buy Signal on Thermo Fisher Scientific (TMO-US)
Our system also triggered a bullish tactical signal on March 31, 2022. Thermo Fisher has a strong track record with a behavorial score of 10/10, therefore we consider the signal as a long term one.
Thermo Fisher is a $ 232 Bn market cap which specializes in the development and manufacturing of laboratory and scientific equipments. Revenues are split between laboratory equipments (70%), diagnostics equipment and products (15%) and scientific analysis equipments (15%) including analyzer (of water, gas, grounds, etc.), mass spectrometers, molecular spectroscopes, microscopes, manometers, samplers, microbiology equipments, reactive agents, etc. Moreover, the group proposes chemical products (reagents, solvent, salts, etc.), consumable products (tubes, funnels, vials, etc.), as well as conditioning, warehousing, storage, etc.;
Thermo Fisher Scientific acquired PPD for $17.4 bn on Dec 8, 2021. PPD is a contract research company that provides early-stage research for drug development. The acquisition is expected to boost revenues and offset covid related growth of the past 2 years.
For 2022, Thermo Fisher is expected to deliver a $ 42 Bn revenue (+7% y/y) coupled with a 26% operating margin. EPS are expected to grow by double digit In the next 3 years. The company is a quality growth stock, a big market cap with low exposure to the economic cycle, it looks like a defensive play in the current market phase.
Short term catalyst: Defensive play, safe haven for “risk off” investors.
This signal is consistent with the bullish reversal in progress in the US Medtech sector. There is currently 64% of US Medtech stocks in bullish tactical but only 15% in bullish strategic signal. The participation of Medtechs stocks to the bullish momentum is growing steadily.