UBS Upgrades Thermo Fisher to Buy on 2027 Growth Outlook

UBS upgraded Thermo Fisher Scientific (NYSE: TMO) to Buy from Neutral and raised its price target to $730 from $540, pointing to projected organic growth and margin expansion across key life sciences markets. The upward revision reflects anticipated demand from pharmaceutical and biotechnology customers, alongside broader adoption of artificial intelligence in research workflows.

Thermo Fisher Scientific supplies analytical instruments, laboratory equipment, reagents, and software to the global healthcare and scientific research sectors. The company's financial performance is closely tied to capital spending by drug developers and academic institutions.

Projected Growth and Margin Expansion

According to an Investing.com report, UBS expects Thermo Fisher to return to organic revenue growth of 5% to 6% by 2027. The brokerage also projects operating margin expansion of 50 to 70 basis points and double-digit earnings per share growth over the forecast period.

Basis points are a standard financial measure where one basis point equals 0.01 percentage points, and a 50 to 70 basis point expansion represents an operating margin increase of 0.50 to 0.70 percentage points. This projected profitability improvement relies on operational efficiencies and a recovery in customer ordering patterns following post-pandemic destocking cycles.

Pharma and Biotech End Markets

Pharmaceutical and biotechnology companies represent Thermo Fisher's largest customer end market, accounting for approximately 60% of total revenue, according to the Investing.com report. Spending shifts in this segment directly influence the company's financial trajectory.

Life sciences firms are integrating artificial intelligence tools into drug discovery and clinical trial optimization. Analysts project these technological advancements to accelerate research timelines and drive sustained demand for high-throughput laboratory consumables and sequencing instrumentation.

Recent Financial Performance

The analyst upgrade follows quarterly results reported by the company. Thermo Fisher posted second-quarter 2026 earnings with adjusted earnings of $6.03 per share on revenue of $11.99 billion, surpassing Wall Street consensus expectations, according to the Investing.com report.