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Thermo Fisher Scientific (NYSE:TMO) Financial Strength

: 6 (As of Dec. 2023)
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Thermo Fisher Scientific has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Thermo Fisher Scientific's Interest Coverage for the quarter that ended in Dec. 2023 was 4.96. Thermo Fisher Scientific's debt to revenue ratio for the quarter that ended in Dec. 2023 was 0.80. As of today, Thermo Fisher Scientific's Altman Z-Score is 3.99.


Competitive Comparison

For the Diagnostics & Research subindustry, Thermo Fisher Scientific's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Thermo Fisher Scientific Financial Strength Distribution

For the Medical Diagnostics & Research industry and Healthcare sector, Thermo Fisher Scientific's Financial Strength distribution charts can be found below:

* The bar in red indicates where Thermo Fisher Scientific's Financial Strength falls into.



Thermo Fisher Scientific Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Thermo Fisher Scientific's Interest Expense for the months ended in Dec. 2023 was $-390 Mil. Its Operating Income for the months ended in Dec. 2023 was $1,934 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $31,308 Mil.

Thermo Fisher Scientific's Interest Coverage for the quarter that ended in Dec. 2023 is

Interest Coverage=-1*Operating Income (Q: Dec. 2023 )/Interest Expense (Q: Dec. 2023 )
=-1*1934/-390
=4.96

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Thermo Fisher Scientific's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(3609 + 31308) / 43544
=0.80

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Thermo Fisher Scientific has a Z-score of 3.99, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 3.99 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Thermo Fisher Scientific  (NYSE:TMO) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Thermo Fisher Scientific has the Financial Strength Rank of 6.


Thermo Fisher Scientific Financial Strength Related Terms

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Thermo Fisher Scientific (NYSE:TMO) Business Description

Address
168 Third Avenue, Waltham, MA, USA, 02451
Thermo Fisher Scientific sells scientific instruments and laboratory equipment, diagnostics consumables, and life science reagents. The firm operates through four segments as of mid-2023 (revenue figures include some cross-segment revenue): analytical technologies (16% of sales); specialty diagnostic products (10%); life science solutions (24%); and lab products and services, which includes CRO services (54%).
Executives
Marc N Casper officer: Senior Vice President C/O THERMO FISHER SCIENTIFIC, 168 THIRD AVENUE, WALTHAM MA 02451
Gianluca Pettiti officer: Executive Vice President C/O BUTTERFLY NETWORK, INC., 530 OLD WHITFIELD STREET, GUILFORD CT 06437
Stephen Williamson officer: Sr. VP and CFO 81 WYMAN STREET, WALTHAM MA 02451
Jennifer M Johnson director C/O FRANKLIN RESOURCES, INC., ONE FRANKLIN PARKWAY, SAN MATEO CA 94403-1906
Michael A Boxer officer: Sr. VP and Gen. Counsel 168 THIRD AVENUE, WALTHAM MA 02451
Lisa P. Britt officer: Sr. VP and Chief HR Officer 168 THIRD AVENUE, WALTHAM MA 02451
Jim P Manzi director 81 WYMAN ST, POST OFFICE BOX 9046, WALTHAM MA 02454
Debora L Spar director C/O GOLDMAN, SACHS & CO., 200 WEST STREET, NEW YORK NY 10282
Michel Lagarde officer: Senior Vice President 450 LEXINGTON AVE., 31ST FLOOR, NEW YORK NY 10017
Ruby R Chandy director 630 DUNDEE ROAD, SUITE 400, NORTHBROOK IL 60062
Mark P Stevenson officer: Executive Vice President 850 LINCOLN CENTRE DRIVE, FOSTER CITY CA 94404
Joseph R. Holmes officer: VP & Chief Accounting Officer 168 THIRD AVENUE, WALTHAM MA 02451
R. Alexandra Keith director ONE PROCTER & GAMBLE PLAZA, CINCINNATI OH 45202
Peter E Hornstra officer: Chief Accounting Officer 81 WYMAN ST, POST OFFICE BOX 9046, WALTHAM MA 02454
Syed A. Jafry officer: Sr. Vice President 345 E. MAIN STREET, WARSAW IN 46580