Thermo Fisher Scientific Inc. (NYSE:TMO)

Raw Materials

The value of raw materials increased significantly from 1305 million US dollars in 2020 to a peak of 2405 million in 2022. Subsequently, there was a decline to 2057 million in 2023 followed by a further reduction to 1803 million in 2024. This suggests an initial accumulation followed by a strategic drawdown or improved supply chain efficiency in recent years.

Work in Process

Work in process inventory exhibited a gradual increase over the period. It rose from 540 million in 2020 to 755 million in 2024, indicating a steady growth trend. The consistent rise suggests ongoing investment in production activities or possibly lengthening manufacturing cycles.

Finished Goods

Finished goods inventory increased from 2184 million in 2020 to 2569 million in 2022, indicating growing stock levels. However, there was a decrease to 2326 million in 2023 before a moderate rebound to 2420 million in 2024. This pattern may reflect fluctuations in demand or adjustments in production to align with market conditions.

Inventories (Total)

Total inventory values grew substantially from 4029 million in 2020 to 5634 million in 2022, indicating a strong build-up of resources. Following this peak, total inventories declined to 5088 million in 2023 and 4978 million in 2024, consistent with the trends observed in raw materials and finished goods. This overall pattern suggests peak inventory levels in 2022, with a subsequent reduction possibly due to inventory optimization or changes in sales volume.

The data reveals several notable trends in the financial metrics over the five-year period analyzed. There is a general increase in inventories and current assets in the earlier years, with some decline observed in the most recent years. Total assets demonstrate substantial growth initially, followed by a plateau and slight decline toward the end of the period. Shareholders’ equity consistently increases year-over-year, reflecting an accumulation of retained earnings or additional capital infusion. Net income shows variability, peaking in the earlier years before decreasing and slightly recovering in the final year.

Inventories

Reported inventories increased significantly from 4,029 million USD in 2020 to a peak of 5,634 million USD in 2022, before declining to 4,978 million USD in 2024. Adjusted inventories closely mirror this trend, indicating minimal impact from LIFO reserve adjustments on inventory valuation.

Current Assets

Reported current assets rose from 21,957 million USD in 2020 to a peak of 25,229 million USD in 2022, followed by decline to 22,137 million USD in 2024. The adjusted figures align closely, suggesting consistent valuation adjustments beyond the inventory consideration.

Total Assets

Total assets expanded markedly from 69,052 million USD in 2020 to 98,726 million USD in 2023, stabilizing and slightly decreasing to 97,321 million USD in 2024. The adjustment for LIFO reserves negligible affect the total assets values across the years, as indicated by the minimal differences.

Shareholders’ Equity

Shareholders’ equity demonstrated steady growth each year from 34,507 million USD in 2020 to 49,584 million USD in 2024. The increase suggests profitable reinvestment or equity contributions, with adjusted equity figures mirroring reported amounts closely.

Net Income

Net income attributable to the company peaked at 7,725 million USD in 2021, then declined to 5,995 million USD in 2023 before slightly recovering to 6,335 million USD in 2024. The adjusted net income figures are slightly higher in some years but generally follow the same trend, indicating minor differences due to inventory accounting adjustments.

Overall, the data reflects a period of growth followed by stabilization and modest declines in inventories, current assets, and total assets. Shareholders’ equity growth has remained consistent, which may indicate financial strength and resilience. The fluctuations in net income suggest variability in operational performance or external factors influencing profitability during the period.

Current Ratio Trend

The current ratio, both reported and adjusted, exhibits a decline from 2.13 in 2020 to 1.48 in 2022, indicative of reduced short-term liquidity. A partial recovery is observed thereafter, reaching 1.75 in 2023 but declining slightly to 1.66 in 2024. The close alignment of reported and adjusted ratios suggests minimal impact from LIFO reserve adjustments on liquidity measurement.

Net Profit Margin Pattern

Net profit margin declined notably from approximately 19.8% in 2020 to 14.77% in 2024. The most significant drop occurred between 2021 and 2022, with margins decreasing from near 19.7% to 15.47%, followed by a continued downward trend stabilizing around 14.77% in 2024. The negligible difference between reported and adjusted margins indicates the LIFO reserve has limited effect on profitability ratios.

Total Asset Turnover Dynamics

Total asset turnover ratios demonstrate some variability without a clear directional trend. Starting at 0.47 in 2020, it fell to 0.41 in 2021, rose again to 0.46 in 2022, then slightly decreased to 0.43 in 2023 and marginally increased to 0.44 in 2024. The consistency between reported and adjusted figures implies inventory valuation changes did not materially affect asset utilization metrics.

Financial Leverage Movement

Financial leverage showed an upward trend from 2.00 in 2020 to a peak of 2.33 in 2021, followed by a gradual decrease to 1.96 by 2024. This decline post-2021 suggests a reduction in the reliance on debt or other liabilities relative to equity. The identical reported and adjusted ratios confirm no significant distortion due to inventory accounting methods.

Return on Equity Analysis

Return on equity follows a declining trajectory, starting near 18.47% in 2020, peaking slightly at 18.94% in 2021, then decreasing steadily to 12.78% by 2024. This trend reflects decreasing profitability from shareholders’ perspective over the analyzed period. The close match of reported and adjusted values points to minimal impact from LIFO reserve adjustments.

Return on Assets Evaluation

Return on assets decreased from 9.23% in 2020 to a low of 6.07% in 2023, with a slight improvement to 6.51% in 2024. This pattern suggests diminishing efficiency in asset utilization to generate profit, although the uptick in the last period could indicate early signs of operational improvement. The negligible difference between reported and adjusted figures further indicates that inventory reserve adjustments exert little influence on asset profitability metrics.

Current Assets

The reported current assets exhibit variability over the five-year period. Starting at $21,957 million at the end of 2020, there is a decline to $20,113 million in 2021, followed by a notable increase to $25,229 million in 2022. Subsequently, current assets slightly decreased to $24,589 million in 2023 and further declined to $22,137 million in 2024. The adjusted current assets closely mirror the reported amounts, showing consistent alignment with no variation across all years except for 2020, where the adjusted figure is marginally higher by $49 million.

Current Ratio

The reported current ratio declined significantly from 2.13 at the end of 2020 to 1.50 in 2021 and further to 1.48 in 2022, indicating a reduction in short-term liquidity relative to current liabilities during this period. This downward trend reversed in 2023, as the ratio improved to 1.75, reflecting an enhanced liquidity position, before slightly decreasing to 1.66 in 2024. The adjusted current ratio, which accounts for inventory LIFO reserve adjustments, remains identical to the reported ratio throughout the entire period, suggesting minimal impact of LIFO adjustments on liquidity analysis.

Overall Analysis

The data reveals fluctuations in working capital components with current assets showing a dip in 2021 followed by recovery and a moderate decline thereafter. Liquidity, as measured by current ratios, deteriorated between 2020 and 2022 but improved in 2023 with a slight reduction in the following year. The close alignment between reported and LIFO reserve adjusted figures suggests that the inventory valuation adjustments have negligible influence on the assessments of current asset levels and short-term liquidity during the examined years.

The financial data shows a trend in both reported and adjusted net income attributable to the company over a five-year period. The reported net income increased substantially from 6,375 million US dollars in 2020 to a peak of 7,725 million in 2021, then declined to 6,950 million in 2022, followed by a more pronounced decrease to 5,995 million in 2023, and a subsequent slight recovery to 6,335 million in 2024. The adjusted net income follows the same pattern, indicating minimal differences between reported and adjusted figures.

Net profit margins, both reported and adjusted, exhibit a similar pattern of decline over the observed period. The margins remained relatively stable around 19.7-19.8% in 2020 and 2021, then decreased notably to 15.47% in 2022. This downward trend continued into 2023, reaching a low of 13.99%, before showing a modest improvement to 14.77% in 2024.

Income Trends

Initial growth in net income from 2020 to 2021 was followed by a decline over the next two years, with a slight rebound in 2024.

Profit Margin Trends

Net profit margins decreased consistently after 2021, reflecting reduced profitability relative to revenues, but the margin slightly improved in the final year reported.

Adjustment Impact

The minimal differences between reported and adjusted figures suggest that adjustments, including LIFO reserve impacts, had limited effect on overall profitability measurements.

The financial data reveals distinct trends in both asset levels and operational efficiency over the five-year period.

Total Assets

The reported total assets exhibited a significant increase from approximately $69 billion in 2020 to about $95 billion in 2021. Following this sharp rise, total assets continued to grow but at a much slower pace, reaching around $97 billion by 2022 and stabilizing near $98 billion in 2023 before slightly declining to $97 billion in 2024. The adjusted total assets closely mirror the reported figures, indicating minimal impact from inventory LIFO reserve adjustments.

Total Asset Turnover

The total asset turnover ratio demonstrates some fluctuations but generally remains below 0.5 over the observed period. Starting at 0.47 in 2020, the ratio decreased to 0.41 in 2021, corresponding to the substantial asset base increase. Subsequently, turnover rebounded to 0.46 in 2022 but declined again to 0.43 in 2023, then slightly increased to 0.44 in 2024. The adjusted turnover ratios are identical to the reported figures, suggesting that inventory adjustments have not materially influenced this efficiency metric.

Overall, asset growth was most pronounced between 2020 and 2021, coinciding with a reduction in asset turnover, reflecting perhaps an increase in asset investment outpacing revenue generation. Thereafter, asset levels plateaued with minor variation, and turnover ratios exhibited modest volatility but no clear trend of sustained improvement or deterioration. The consistency between reported and adjusted figures implies that LIFO inventory adjustments had negligible effect on reported assets and turnover ratios during this timeframe.

The analysis of the provided financial data reveals several distinct trends in the total assets, shareholders’ equity, and financial leverage over the five-year period ending December 31, 2024.

Total Assets

Total assets show a marked increase from 2020 to 2021, rising from approximately $69.1 billion (adjusted) to about $95.1 billion. This suggests a significant expansion or acquisition activity within this period. From 2021 onward, total assets exhibit a relatively stable pattern with slight fluctuations, peaking at around $98.7 billion in 2023 before a modest decline to approximately $97.3 billion in 2024. Overall, the asset base enlarged substantially between 2020 and 2024, albeit with a stabilization trend in the latter years.

Shareholders’ Equity

Shareholders’ equity consistently increased throughout the period, starting at roughly $34.6 billion (adjusted) in 2020 and steadily rising each year to nearly $49.6 billion by the end of 2024. This upward trajectory indicates ongoing retained earnings growth and possibly additional equity issuance, reflecting strengthened capital structure and enhanced shareholder value over time.

Financial Leverage

Financial leverage, calculated as the ratio of total assets to shareholders’ equity, shows a peak in 2021 at 2.33 and subsequently follows a declining trend, falling to 1.96 by the end of 2024. This decrease suggests a gradual reduction in reliance on debt or other liabilities relative to equity financing. The decline in leverage may imply a more conservative capital structure and reduced financial risk.

Adjustment Effects

The adjusted figures, accounting for inventory LIFO reserves, closely mirror the reported data with minimal differences observed in total assets and shareholders’ equity. This indicates that inventory accounting adjustments had a negligible impact on the overall financial position and leverage ratios during the period under review.

The data reveals several notable trends in financial performance and equity structure over the five-year period from 2020 to 2024.

Net Income

The reported net income attributable to the company increased from 6,375 million US dollars in 2020 to a peak of 7,725 million US dollars in 2021. Following this peak, net income decreased steadily, reaching 6,950 million in 2022, then dropping further to 5,995 million in 2023 before slightly recovering to 6,335 million in 2024. Adjusted net income, after accounting for the LIFO reserve, follows a very similar trend with only minor deviations, suggesting that inventory adjustments had a negligible impact on reported profitability during this period.

Shareholders’ Equity

Reported total shareholders’ equity shows consistent growth throughout the period, increasing from 34,507 million US dollars in 2020 to 49,584 million US dollars in 2024. This growth trajectory indicates steady capital accumulation or retained earnings expansion. Adjusted shareholders’ equity data mirrors the reported amounts, with a minor variation only in 2020, indicating minimal effect from inventory LIFO reserve adjustments on equity figures.

Return on Equity (ROE)

Both reported and adjusted ROE exhibit a declining trend from 2020 through 2024. ROE decreased from approximately 18.5% in 2020 to about 12.8% in 2024, reflecting a diminishing return on equity despite the growth in shareholders' equity. This decline could be attributable to the reduction in net income coupled with the expanding equity base. The close alignment between reported and adjusted ROE demonstrates that inventory reserve adjustments have limited influence on this profitability metric.

In summary, the company experienced strong net income growth in the initial year followed by a downturn in earnings that slightly recovered in the final year. Shareholders’ equity demonstrated continuous growth, contributing to a lower return on equity over time. The LIFO reserve adjustments appear to have minimal impact on the core financial indicators presented.

The financial data exhibits several notable trends over the five-year period from 2020 to 2024. Net income, both reported and adjusted for inventory LIFO reserve, shows fluctuations with a peak in 2021 followed by a decline and then a slight recovery.

Net Income

Reported net income increased significantly from approximately $6.375 billion in 2020 to $7.725 billion in 2021, reflecting robust profitability. However, this was followed by a decline to $6.950 billion in 2022 and a further drop to $5.995 billion in 2023. The figure then modestly recovered to $6.335 billion in 2024. Adjusted net income closely mirrors the reported figures, indicating minimal difference attributed to inventory LIFO reserve adjustments.

Total Assets

The company's total assets experienced consistent growth during the period from 2020 through 2023, increasing from approximately $69.1 billion in 2020 to nearly $98.7 billion in 2023. In 2024, total assets slightly decreased to about $97.3 billion. The adjusted total assets are nearly identical to the reported values, suggesting limited impact from LIFO reserve adjustments on the asset base.

Return on Assets (ROA)

Return on assets demonstrates a downward trend throughout the period. In 2020, ROA stood at approximately 9.2%. This ratio declined steadily to 8.1% in 2021 and further down to 7.1% in 2022. The decreasing trend continued with ROA dropping to 6.1% in 2023, followed by a minor improvement to 6.5% in 2024. The adjusted ROA figures are very close to the reported ones, indicating negligible effects of inventory valuation changes on profitability relative to assets.

In summary, profitability measured by net income peaked in 2021 before declining over the next two years, with a slight recovery in 2024. Asset base grew robustly until 2023 before leveling off. The company's efficiency in generating returns from its assets decreased progressively, which may be associated with the overall decline in profitability despite asset growth. Adjustments for LIFO reserve have minimal impact on reported financial outcomes, indicating consistent valuation practices in this area.