Thermo Fisher Scientific (NYSE:TMO) is one of the best life-sciences stocks you can buy now. This is the world's largest life-sciences company. With its tentacles wrapped around every facet of the life-sciences industry, though, investors who buy this stock now can reasonably expect positive returns over the long run.
In 2020, COVID-19 made it hard for scientists to work together in laboratories full of Thermo Fisher Scientific equipment. This was a nightmare for lots of life-sciences businesses, but explosive demand for COVID-19 diagnostics made up the difference and more. Total revenue surged 26% year over year in 2020, and adjusted earnings came in 58% higher.
Thermo Fisher Scientific expects demand for COVID-19 testing to drop off by the end of 2021, but a rebounding base business will allow total revenue and earnings to climb again this year.
Strong cash flow generation from a well-managed operation will give Thermo Fisher a chance to tighten its grip on the life-sciences industry. In April, the company offered $17.4 billion in cash to buy PPD, Inc. (NASDAQ:PPD), one of the world's largest contract research organizations.
Giving it back
Thermo Fisher Scientific rewards its shareholders with share buybacks and dividend raises. Thermo Fisher earmarked $1.5 billion for share buybacks in 2021 after returning $1.8 billion to shareholders in 2020.
There are no guarantees that Thermo Fisher Scientific will continue generating enormous profits to share with investors. Given all the right pieces in place, though, it sure seems likely.
https://www.fool.com/investing/2021/04/29/2-risky-life-science-stocks-to-avoid-and-1-to-buy
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