- The scientific instruments maker has been boosted by demand for Covid-19 tests and is also working on more than 250 projects to develop treatments and vaccines
- Beyond the pandemic, the group is well-positioned to benefit from rising healthcare spending, in particular on new technologies such as gene therapy
Long-term structural growth drivers
Near-term Covid-19 boost
Analyst upgrades
Fund manager pick
Cyclical exposure
Premium valuation
Thermo Fisher Scientific (US:TMO) may not be a household name, but it is a giant in the world of scientific research. The group provides everything from basic laboratory equipment to specialised machines that can decode genetic sequences. Leading positions in its end markets have been underpinned by an expanding global footprint and focus on product innovation – it spends $1bn (£770m) on research and development (R&D) each year. This technological edge has enabled high margins (see chart), which have translated to a rising return on equity (ROE), a key measure of quality and profitability. Adjusted ROE advanced from 9.6 per cent in 2010 to 22.6 per cent at the end of September.