Thermo Fisher Scientific Inc. (NYSE:TMO): What We Can Expect From This Growth Stock
Since Thermo Fisher Scientific Inc. (NYSE:TMO) released its earnings in December 2018, analysts seem cautiously optimistic, with profits predicted to increase by 18% next year relative to the past 5-year average growth rate of 11%. Currently with trailing-twelve-month earnings of US$2.9b, we can expect this to reach US$3.5b by 2020. Below is a brief commentary around Thermo Fisher Scientific's earnings outlook going forward, which may give you a sense of market sentiment for the company. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
Check out our latest analysis for Thermo Fisher Scientific
What can we expect from Thermo Fisher Scientific in the longer term?
Longer term expectations from the 15 analysts covering TMO’s stock is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of TMO's earnings growth over these next few years.
By 2022, TMO's earnings should reach US$4.5b, from current levels of US$2.9b, resulting in an annual growth rate of 14%. This leads to an EPS of $11.36 in the final year of projections relative to the current EPS of $7.31. In 2022, TMO's profit margin will have expanded from 12% to 16%.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For Thermo Fisher Scientific, there are three essential aspects you should further examine:
Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
Valuation: What is Thermo Fisher Scientific worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Thermo Fisher Scientific is currently mispriced by the market.
Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Thermo Fisher Scientific? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
