Key insights from Omega Advisors' 4Q14 positions (Part 5 of 9)
(Continued from Part 4)
Omega Advisors and Thermo Fisher Scientific
Omega Advisors has exited its position in Thermo Fisher Scientific (TMO) as per its 13F filings for 4Q14. The stock represented 1.55%, or $105 million, of the total hedge fund portfolio for 3Q14. TMO has a 0.28% exposure to the SPDR S&P 500 (SPY). The ETF tracks the overall performance of 500 publicly traded companies in the growth sector.
Overview of Thermo Fisher Scientific
Thermo Fisher Scientific, or TMO, offers analytical instruments, laboratory equipment, software, services, consumables, reagents, chemicals, and supplies to pharmaceutical and biotech companies, hospitals, and clinical diagnostic labs.
TMO has expanded its product lines and services by developing and commercializing its own technologies and by making strategic acquisitions of complementary businesses. In February, the company completed the acquisition of Life Technologies Corporation for a total purchase price of $15.30 billion. Life Technologies provides innovative products and services to customers conducting scientific research and genetic analysis, as well as those in applied markets, such as forensics and food safety testing.
TMO has four business segments: Life Sciences Solutions, Analytical Instruments, Specialty Diagnostics, and Laboratory Products and Services.
TMO reports 4Q14 and full-year results
In January 2015, TMO released its 4Q14 and full-year 2014 results. The revenues reported for 4Q14 were $4.49 billion, a 30% increase when compared to 4Q13 when the revenues reported were $3.47 billion. The company’s earnings per share (or EPS) also grew 39% to $1.99 whereas it was $1.43 in 4Q13. For the fiscal year 2014, adjusted EPS grew 28% to $6.96, versus $5.42 in 2013. Revenue for 2014 grew 29% to $16.89 billion, compared with $13.09 billion a year ago.
The CEO of TMO said, “Looking back on 2014, we successfully executed our growth strategy to deliver very strong financial performance while investing to set the company up for a bright future. It was a terrific year for innovation, with significant product launches across our specialty diagnostics, analytical instruments and life sciences businesses. In emerging markets, we expanded our presence in Southeast Asia, India and Brazil to meet the needs of our customers in these high-growth regions. In addition, our successful integration of Life Technologies has strengthened our customer value proposition and positions us to begin achieving revenue synergies in 2015.”
Thermo Fisher Scientific acquires Advanced Scientific
In February 2015, TMO announced its acquisition of Advanced Scientific (ASI), “a global provider of single-use technologies for customized bioprocessing solutions,” for $300 million. Advanced Scientific has over 350 employees with operations in Mexico as well as Pennsylvania, with revenues of approximately $80 million in 2014.
This acquisition will be an opportunity for TMO to meet customer demand in terms of quality as well as productivity in bio processing.
Omega Advisors’ holdings
The hedge fund started new positions in Time Warner (TWX) and Gilead Sciences (GILD), while it sold its positions in Sprint (S), Thermo Fisher Scientific (TMO), and Halliburton (HAL). Omega Advisors increased its position in Ashland (ASH) and Groupon (GRPN). The fund decreased its position in Chimera Investment Group (CIM), JP Morgan Chase (JPM), and Apple (AAPL).
Continue to Part 6
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