US Life Science Tools & Diagnostics: Pack-it-Up This Week‘s Wrap-Up

研报英文原文证据摘录

US Life Science Tools & Diagnostics: Pack-it-Up This Week‘s Wrap-Up

Strength in the quarter was led by PPD/CRO and the

Research & Safety Market Channel businesses. We note the CDMO (pharma

services) and CRO business continue to perform well attributable to the higher

customer demand. PPD continued to deliver a solid B2B (above 1.13x in our view)

with a generally healthier market environment and another uptick in biotech

authorizations. Pharma services grew modestly/LSD this quarter, with 2H expected

to be stronger based on production schedules, customer campaigns, and wins

related to reshoring. More specifically for CDMO/pharma services, growth is

expected to improve in 2H with customer readiness, timing, and comps driving 3Q

growth to exceed 4Q, with 2H approaching the LDD growth range. Lastly, the

Channel business was noted as the fastest growing piece of the LPBS segment.

Clario was said to be integrating smoothly, with funnel of revenue synergies

building nicely.

Looking forward — 3Q26 organic growth was called to land ~4% compared to

FactSet consensus of ~3.4%, with an adj. EPS between $6.38-$6.43 ahead of

consensus of $6.37. This reflects ~80bps of Y/Y OPM expansion in our view. 4Q26

is also assumed to be ~4% organic. Pharma Services is expected to be stronger in

2H vs 1H with 3Q potentially better than 4Q due to batch timing. Overall the 2H

improved outlook is driven by the continued strengthening of the Pharma and

Biotech end market. However, TMO is not factoring in a sustained recovery in A&G.

This translates to the updated FY26 guidance for organic growth now towards the

upper end of the 3-4% guide, calling for ~4% growth, with total reported revenue

increased to $47.4-48.1B ($47.3-48.1B prior). This includes ~$1.6B from M&A,