Revenue related to the coronavirus enabled Thermo Fisher Scientific Inc. (TMO, Financial) to post huge sales and earnings gains in the third quarter. The Waltham, Massachusetts-based provider of diagnostic test kits, laboratory hardware and supplies recorded revenue of more than $8.5 billion from July through September, a 35% increase over the same period a year earlier. Nearly a quarter of sales were tied to the coronavirus. Third-quarter adjusted earnings per share were $5.63, up more than 90% from the previous year.
There's more good news. The company expects full-year revenue to climb by 20% to approximately $30.5 billion and adjusted earnings to gain 48% to $18.27 per share, Chairman, President, and CEO Marc Casper said during the quarter's earnings call.
Investors were certainly pleased with Thermo Fisher's performance. The stock hit a 52-week high of about $484, up 63% from last October. The move gives the company a market cap of more than $191 billion.
Casper told FierceBiotech that Thermo Fisher has continued to meet the demand for Covid-related demand with new products, such as tests and automated workflows that accurately diagnose the virus. "At the same time, we're adding new capabilities, including scaling up production of sample collection products and essential laboratory supplies as well as increasing our pharma services capacity to support new therapies and vaccines," he said.
During the quarter, Thermo Fisher further extended its global pandemic tools by introducing the Amplitude Solution to automate high-throughput testing for Covid, substantially increasing capacity for viral transport media production in Europe, and introducing two new antibody tests that are available in the U.S. and Europe.
One disappointment during the quarter was the scuttling of Thermo Fisher's attempt to take over the Dutch diagnostics company Qiagen N.V. (QGEN, Financial). The proposed $11.5 billion deal folded even after Thermo Fisher said it would up the offer by a few billion dollars. Qiagen would likely be much more expensive now given it's seen a substantial increase in its value thanks to demand for Covid testing.
Of 15 analysts covering Thermo Fisher, all but one rate the company a buy or strong buy, according to Yahoo Finance. They assigned it a median target price of $462, with a low of $260 and a high of $520, although those projections were likely made before third-quarter results were released.
Disclosure: The author has no positions in any of the companies mentioned in this article.
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