Thermo Fisher Scientific Inc. TMO is slated to release fourth-quarter 2024 results on Jan. 30, before market open.

See the Zacks Earnings Calendar to stay ahead of market-making news. 

Thermo Fisher’s third-quarter earnings of $5.28 per share beat the Zacks Consensus Estimate by 0.6%. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.63%.

TMO’s Q4 Estimates

The Zacks Consensus Estimate for revenues is pegged at $11.25 billion, suggesting 3.3% growth from the prior-year quarter’s reported figure. The consensus mark for earnings is pegged at $5.92 per share, indicating 4.4% growth from the year-ago quarter’s reported numbers.

Estimate Revision Trend Ahead of Earnings

Estimates for Thermo Fisher’s fourth-quarter earnings have remained unchanged at $5.92 per share in the past 30 days.

Now, let's look at how things might have progressed for the MedTech major prior to the announcement.

Factors at Play

Thermo Fisher’s Analytical Instruments segment is expected to have generated strong fourth-quarter sales, banking on its newly launched cutting-edge technologies. The segment is expected to benefit from its electron microscopy business. In the fourth quarter, the company introduced the Thermo Scientific Iliad (Scanning) Transmission Electron Microscope, which integrates a number of TMO’s advanced analytical technologies into a seamless and user-friendly workflow. 

In the third quarter, the R&D 100 Awards honored Thermo Scientific Orbitrap Astral Mass spectrometer in the market disruptors special recognition category. Additionally, per management, the adoption of Thermo Scientific’s Orbitrap Astral continues to be incredibly strong. We expect these developments to have contributed to TMO’s fourth-quarter revenues.

Per our model, Thermo Fisher’s Analytical Instruments business should earn $2.19 billion in revenues, suggesting 7.5% growth year over year.

Within the Life-Science Solutions segment, the company is likely to have experienced a sales decline due to the runoff of pandemic-related revenues. In May 2023, WHO declared an end to COVID-19 as a public health emergency. 

Within this segment, in the third quarter, the company launched the Applied Biosystems MagMAX Sequential DNA/RNA kit, which helps researchers identify unique insights into cancer-causing genetic alterations. Also, TMO introduced Invitrogen Vivofectamine Delivery Solutions, which delivers nucleic acids to multiple targets with therapeutic effects. These developments might have turned in favor of Thermo Fisher in the fourth quarter. 

Meanwhile, the bioproduction business has likely grown in the quarter, banking on strong adoption in the pharma and biotech segment. Within this business, the company introduced Gibco CTS Detachable Dynabeads CD4 and CTS Detachable Dynabeads CD8, which expanded on Thermo Fisher’s CTS Detachable Dynabeads platform. 

Meanwhile, TMO is expected to have gained from its successful acquisition of Olink Holding AB during the third quarter. 

Per our model, the Life-Science Solutions business is expected to have generated $2.65 billion in revenues for the fourth quarter, calling for a 7.5% improvement year over year.

The Specialty Diagnostics segment (Clinical Diagnostics business from the molecular controls that go into testing kits) is expected to have gained positive contributions, led by its transplant diagnostics and immunodiagnostics businesses as well as the healthcare market channel. Additionally, during the fourth quarter, the company received approval from the Food and Drug Administration (“FDA”) for its Ion Torrent Oncomine Dx Target Test as a companion diagnostic (CDx) to identify patients eligible for treatment with VORANIGO tablets.

Thermo Fisher Scientific Inc. Price and EPS Surprise

Thermo Fisher Scientific Inc. price-eps-surprise | Thermo Fisher Scientific Inc. Quote

In the previous quarter, TMO partnered with the National Cancer Institute on the myeloMATCH (Molecular Analysis for Therapy Choice) precision medicine umbrella trial. The company also launched a pre-transplant risk assessment assay to help assess the risk of early acute rejection in kidney transplant recipients. Moreover, it secured 510(k) FDA clearance for SeCore CDx HLA A Sequencing System for synovial sarcoma. We expect these developments to have had a positive impact on the company’s fourth-quarter top-line performance. 

Our model projects TMO’s Specialty Diagnostics business to report $1.13 billion in revenues, suggesting 2% growth year over year.

Within the Laboratory Products and Services segment, revenues are expected to have increased due to the research and safety market channel. During the fourth quarter, the company introduced Thermo Scientific iCAP MX Series ICP-MS, designed for environmental, food, industrial and research labs to analyze routine and challenging trace elements to detect and mitigate harmful substances.

During the third quarter, the company opened its first electron microscopy demo center, NanoPort, in Taiwan. TMO also expanded its global laboratory services with a new bioanalytical lab in GoCo Health Innovation City in Gothenburg, Sweden. This, too, while strengthening the company’s foothold in Taiwan, might have had a favorable impact on TMO’s top line in the to-be-reported quarter. 

Our model expects TMO’s Laboratory Products and Services business’ fourth-quarter revenues to be $5.72 billion, flat year over year. 

What Our Quantitative Model Predicts

Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.

Earnings ESP: Thermo Fisher has an Earnings ESP of +0.65%. 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 #4.

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 reporting cycle.

Argenx ARGX has an Earnings ESP of +44.82% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here. 

The company is expected to release fourth-quarter 2024 results on March 6. The Zacks Consensus Estimate for EPS implies a surge of 196.4% from the year-ago quarter’s reported figure.

Arcutis Biotherapeutics ARQT has an Earnings ESP of +7.97% and a Zacks Rank #2 at present. The company is expected to release fourth-quarter 2024 results on Feb. 25. ARQT’s earnings surpassed estimates in three of the trailing four quarters and missed in one, the average surprise being 17.46%. 

Axogen AXGN has an Earnings ESP of +36.36% and a Zacks Rank #2 at present. The company is likely to release fourth-quarter 2024 results on March 4. The Zacks Consensus Estimate for EPS implies a surge of 166.7% from the year-ago quarter’s reported figure.

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Thermo Fisher Scientific Inc. (TMO) : Free Stock Analysis Report

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