Thermo Fisher Scientific Inc. Beat Analyst Estimates: See What The Consensus Is Forecasting For Next Year

Thermo Fisher Scientific Inc. (NYSE:TMO) just released its third-quarter report and things are looking bullish. Thermo Fisher Scientific delivered a significant beat to revenue and earnings per share (EPS) expectations, with sales hitting US$8.5b, some 11% above indicated. Statutory EPS were US$4.84, an impressive 36% ahead of forecasts. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

View our latest analysis for Thermo Fisher Scientific

Taking into account the latest results, the most recent consensus for Thermo Fisher Scientific from 20 analysts is for revenues of US$32.1b in 2021 which, if met, would be a meaningful 13% increase on its sales over the past 12 months. Per-share earnings are expected to jump 21% to US$14.89. Before this earnings report, the analysts had been forecasting revenues of US$31.1b and earnings per share (EPS) of US$13.73 in 2021. It looks like there's been a modest increase in sentiment following the latest results, withthe analysts becoming a bit more optimistic in their predictions for both revenues and earnings.

It will come as no surprise to learn that the analysts have increased their price target for Thermo Fisher Scientific 6.5% to US$494on the back of these upgrades. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Thermo Fisher Scientific, with the most bullish analyst valuing it at US$550 and the most bearish at US$325 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of Thermo Fisher Scientific'shistorical trends, as next year's 13% revenue growth is roughly in line with 11% annual revenue growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 9.1% per year. So although Thermo Fisher Scientific is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Thermo Fisher Scientific following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that in mind, we wouldn't be too quick to come to a conclusion on Thermo Fisher Scientific. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Thermo Fisher Scientific going out to 2024, and you can see them free on our platform here..

It is also worth noting that we have found 2 warning signs for Thermo Fisher Scientific that you need to take into consideration.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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