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Thermo Fisher Scientific (TMO) Outpaces Stock Market Gains: What You Should Know

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Zacks Equity Research
·3 min read
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In the latest trading session, Thermo Fisher Scientific (TMO) closed at $518.83, marking a +0.82% move from the previous day. This move outpaced the S&P 500's daily gain of 0.36%. Meanwhile, the Dow lost 0.12%, and the Nasdaq, a tech-heavy index, added 0.69%.

Coming into today, shares of the maker of scientific instrument and laboratory supplies had gained 12.34% in the past month. In that same time, the Medical sector gained 3.29%, while the S&P 500 gained 4.27%.

Wall Street will be looking for positivity from TMO as it approaches its next earnings report date. This is expected to be February 1, 2021. The company is expected to report EPS of $6.36, up 79.15% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for TMO. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.82% higher. TMO is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, TMO is holding a Forward P/E ratio of 25.78. Its industry sports an average Forward P/E of 44.65, so we one might conclude that TMO is trading at a discount comparatively.

Also, we should mention that TMO has a PEG ratio of 1.43. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TMO's industry had an average PEG ratio of 4.1 as of yesterday's close.

The Medical - Instruments industry is part of the Medical sector. This group has a Zacks Industry Rank of 177, putting it in the bottom 31% 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.

To follow TMO in the coming trading sessions, be sure to utilize Zacks.com.


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