TMO Stock Forecast & Price Target

Thermo Fisher Scientific is positioned for a positive outlook due to its projected revenue growth across various segments, with the life science solutions segment anticipated to grow at a robust 5.4% compound annual rate over the next three years and the analytical technologies segment expected to expand at 2.5%. The company is also set to enhance its market presence through the acquisition of Clario, which will strengthen its contract research organization (CRO) business and align with increasing biopharma clinical trial outsourcing trends, as indicated by survey responses showing a desire for heightened outsourcing in both early and late-stage drug development. Additionally, the adjusted earnings per share (EPS) is projected to grow at an impressive 8.5% compound annual rate over the next four years, further substantiating the strong financial performance outlook for Thermo Fisher Scientific.

Thermo Fisher Scientific has experienced a significant decline in its adjusted EBIT margin, which fell by approximately 830 basis points to 22.6% from 2021 to 2024, indicating deteriorating operational efficiency. Additionally, the adjusted gross margin decreased by roughly 940 basis points to 42.2%, which is notably lower than the 46.4% gross margin recorded in 2019, reflecting challenges in maintaining profitability. Furthermore, the firm faces headwinds in the biotech sector, with funding in 2025 starting off slowly, as evidenced by a 45% year-over-year decline in capital raised during the first half of the year, which could affect future revenue growth prospects.