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Thermo Fisher Scientific Inc. (TMO) is a leading scientific instrument maker based in Massachusetts, valued at an impressive market cap of $204.4 billion. It also offers life sciences solutions, analytical instruments, specialty diagnostics, laboratory products, and biopharma services worldwide.
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and Therma Fisher Scientific fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the medical devices sector. The company has established a dominant presence in various life sciences sectors, backed by advanced R&D, effective PPI systems, and significant economies of scale. These advantages have reinforced its position as a key leader in the industry.
Despite its strengths, Thermo Fisher Scientific has hit rough waters. TMO stock is currently down 15.8% from its 52-week high of $627.88, achieved on Sept. 10. Moreover, shares of TMO have plummeted 13.6% over the past three months, lagging behind the First Trust Indxx Global Medical Devices ETF (MDEV), which has gained marginally over the same time frame.
In the long term, TMO is down marginally on a YTD basis, and the stock has soared 6.8% over the past 52 weeks. By contrast, MDEV is up 6.7% in 2024 and 15.3% over the past year.
Adding to the weak price performance, TMO has been trading below its 200-day moving average since late October and under its 50-day moving average since early October.
Thermo Fisher's recent underperformance might have resulted from intense competition, economic uncertainties, and regulatory challenges impacting its market share and profitability.
Despite reporting better-than-expected Q3 adjusted EPS of $5.28, shares of TMO fell 1.7% on Oct. 23 after the company announced its Q3 earnings, due to a revenue miss, with only a modest marginal year-over-year growth to $10.6 billion.
Thermo Fisher Scientific has been struggling to keep up with its top rival, Bio-Rad Laboratories, Inc. (BIO), which has climbed 9.6% over the past 52 weeks and 4.8% on a YTD basis.
Although TMO's price performance has not been particularly impressive, analysts are highly optimistic about the stock's prospects. The stock has a consensus rating of “Strong Buy” from 24 analysts covering it, and the mean price target of $655.48 is a premium of 23.9% to current levels.
