Thermo Fisher eyes South Korea, Brazil, Russia for future growth

Thermo Fisher Scientific ($TMO) is once again throwing around that now-ubiquitous phrase: "emerging markets." But this time, there's a twist. Company executives revealed during an investor meeting in New York that the global maker of high-tech instruments for medical diagnostics, biotechnology research and environmental/food testing would be focusing more on South Korea, Brazil and Russia for future growth.

Reuters recounts the basis for the move. Executives explained during the meeting that they want to repeat the success they've already had in China and India, the two "emerging markets" that garner most of the press these days, where demand for air and water quality improvements and biotech development remains strong.

That strategy has worked, in part, as the company shifted manufacturing to China and places in Eastern Europe, the article explains. Those changes, plus site consolidations, should help Thermo Fisher save $20 million this year, the article notes.  Longer term, Thermo Fisher also sees half of its China revenue coming from products manufactured there directly, rather than imported into the country.

With this emerging market strategy, executives explained they want 25% of their revenue to come from emerging markets within 14 years, versus 19% now, according to the story.

With this focus, plus growth driven by recent (and future) acquisitions and cost cutting, CFO Peter Wilver told Reuters that the company's 2016 revenue could hit as much as $15.5 billion now with at least $7.50 in earnings per share. That would be a healthy jump from the $11.7 billion in revenue and adjusted earnings of $4.16 per share Thermo Fisher had in 2011, Reuters notes.

Morningstar analyst Alex Morozov liked what he heard. He told Reuters that the projections are a positive sign of stable markets in the western world but also that "the emerging market growth is really going to be the driver here."

- read the Reuters story