Stock Analysis on Net

Thermo Fisher Scientific Inc. (NYSE:TMO)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Thermo Fisher Scientific Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Customer relationships 22,762 21,792 22,802 16,593 16,906
Product technology 5,894 5,882 6,041 5,523 5,544
Tradenames 1,634 1,635 1,722 1,213 1,300
Backlog 1,084 1,038 1,060
Other 9
Acquisition-related intangible assets, definite lived, gross 31,374 30,347 31,625 23,329 23,759
Accumulated amortization (15,939) (14,140) (12,747) (11,879) (10,996)
Acquisition-related intangible assets, definite lived, net 15,435 16,207 18,878 11,450 12,763
Tradenames 1,235 1,235 1,235 1,235 1,235
In-process research and development 16
Acquisition-related intangible assets, indefinite lived 1,235 1,235 1,235 1,235 1,251
Acquisition-related intangible assets 16,670 17,442 20,113 12,685 14,014
Goodwill 44,020 41,196 41,924 26,041 25,714
Acquisition-related intangible assets and goodwill 60,690 58,638 62,037 38,726 39,728

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Acquisition-related intangible assets Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Thermo Fisher Scientific Inc. acquisition-related intangible assets decreased from 2021 to 2022 and from 2022 to 2023.
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Thermo Fisher Scientific Inc. goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Acquisition-related intangible assets and goodwill Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Thermo Fisher Scientific Inc. acquisition-related intangible assets and goodwill decreased from 2021 to 2022 but then increased from 2022 to 2023 not reaching 2021 level.

Adjustments to Financial Statements: Removal of Goodwill

Thermo Fisher Scientific Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 98,726 97,154 95,123 69,052 58,381
Less: Goodwill 44,020 41,196 41,924 26,041 25,714
Total assets (adjusted) 54,706 55,958 53,199 43,011 32,667
Adjustment to Total Thermo Fisher Scientific Inc. Shareholders’ Equity
Total Thermo Fisher Scientific Inc. shareholders’ equity (as reported) 46,735 43,978 40,793 34,507 29,675
Less: Goodwill 44,020 41,196 41,924 26,041 25,714
Total Thermo Fisher Scientific Inc. shareholders’ equity (adjusted) 2,715 2,782 (1,131) 8,466 3,961

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).


Thermo Fisher Scientific Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Goodwill (Summary)

Thermo Fisher Scientific Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Total Asset Turnover
Reported total asset turnover 0.43 0.46 0.41 0.47 0.44
Adjusted total asset turnover 0.78 0.80 0.74 0.75 0.78
Financial Leverage
Reported financial leverage 2.11 2.21 2.33 2.00 1.97
Adjusted financial leverage 20.15 20.11 5.08 8.25
Return on Equity (ROE)
Reported ROE 12.83% 15.80% 18.94% 18.47% 12.45%
Adjusted ROE 220.81% 249.82% 75.30% 93.31%
Return on Assets (ROA)
Reported ROA 6.07% 7.15% 8.12% 9.23% 6.33%
Adjusted ROA 10.96% 12.42% 14.52% 14.82% 11.31%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Thermo Fisher Scientific Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Thermo Fisher Scientific Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.

Thermo Fisher Scientific Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Revenues 42,857 44,915 39,211 32,218 25,542
Total assets 98,726 97,154 95,123 69,052 58,381
Activity Ratio
Total asset turnover1 0.43 0.46 0.41 0.47 0.44
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Revenues 42,857 44,915 39,211 32,218 25,542
Adjusted total assets 54,706 55,958 53,199 43,011 32,667
Activity Ratio
Adjusted total asset turnover2 0.78 0.80 0.74 0.75 0.78

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Total asset turnover = Revenues ÷ Total assets
= 42,857 ÷ 98,726 = 0.43

2 Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 42,857 ÷ 54,706 = 0.78

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Thermo Fisher Scientific Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 98,726 97,154 95,123 69,052 58,381
Total Thermo Fisher Scientific Inc. shareholders’ equity 46,735 43,978 40,793 34,507 29,675
Solvency Ratio
Financial leverage1 2.11 2.21 2.33 2.00 1.97
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 54,706 55,958 53,199 43,011 32,667
Adjusted total Thermo Fisher Scientific Inc. shareholders’ equity 2,715 2,782 (1,131) 8,466 3,961
Solvency Ratio
Adjusted financial leverage2 20.15 20.11 5.08 8.25

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total Thermo Fisher Scientific Inc. shareholders’ equity
= 98,726 ÷ 46,735 = 2.11

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Thermo Fisher Scientific Inc. shareholders’ equity
= 54,706 ÷ 2,715 = 20.15


Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Thermo Fisher Scientific Inc. 5,995 6,950 7,725 6,375 3,696
Total Thermo Fisher Scientific Inc. shareholders’ equity 46,735 43,978 40,793 34,507 29,675
Profitability Ratio
ROE1 12.83% 15.80% 18.94% 18.47% 12.45%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Thermo Fisher Scientific Inc. 5,995 6,950 7,725 6,375 3,696
Adjusted total Thermo Fisher Scientific Inc. shareholders’ equity 2,715 2,782 (1,131) 8,466 3,961
Profitability Ratio
Adjusted ROE2 220.81% 249.82% 75.30% 93.31%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROE = 100 × Net income attributable to Thermo Fisher Scientific Inc. ÷ Total Thermo Fisher Scientific Inc. shareholders’ equity
= 100 × 5,995 ÷ 46,735 = 12.83%

2 Adjusted ROE = 100 × Net income attributable to Thermo Fisher Scientific Inc. ÷ Adjusted total Thermo Fisher Scientific Inc. shareholders’ equity
= 100 × 5,995 ÷ 2,715 = 220.81%


Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Thermo Fisher Scientific Inc. 5,995 6,950 7,725 6,375 3,696
Total assets 98,726 97,154 95,123 69,052 58,381
Profitability Ratio
ROA1 6.07% 7.15% 8.12% 9.23% 6.33%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Thermo Fisher Scientific Inc. 5,995 6,950 7,725 6,375 3,696
Adjusted total assets 54,706 55,958 53,199 43,011 32,667
Profitability Ratio
Adjusted ROA2 10.96% 12.42% 14.52% 14.82% 11.31%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net income attributable to Thermo Fisher Scientific Inc. ÷ Total assets
= 100 × 5,995 ÷ 98,726 = 6.07%

2 Adjusted ROA = 100 × Net income attributable to Thermo Fisher Scientific Inc. ÷ Adjusted total assets
= 100 × 5,995 ÷ 54,706 = 10.96%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Thermo Fisher Scientific Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.