Key insights
- Evercore survey indicates increased biopharma R&D spending in 2026, boosting optimism for life science tools companies. The firm maintains Buy ratings on TMO, A, RGEN, and DHR, citing attractive valuations. Danaher's recent earnings beat and Masimo acquisition further support a positive outlook for the sector. This suggests a moderate bullish signal for related US equities.
Investing.com - Evercore released survey results indicating biopharma companies plan to increase drug development spending in 2026 after a slower-than-expected start to the year.
The survey shows laboratory budgets are expected to rise 9% on average in 2026, with positive responses across biotech companies and contract research organizations. Two-thirds of survey participants anticipate higher expenditures this year.
Spending on consumables is projected to increase 5% to 7% on average, while 53% of respondents indicated high confidence in equipment purchases. The firm notes life science tools stocks trade below second-quarter 2025 pre-MFN agreement valuation levels.
Evercore maintains a Buy rating on Thermo Fisher Scientific (NYSE:TMO) with a price target of $470.21, noting the stock trades at 17.5 times earnings. The firm also rates Agilent Technologies (NYSE:A), Repligen (NASDAQ:RGEN), and Danaher (NYSE:DHR) as Buy with price targets of $111.75, $117.61, and $190.11 respectively. Danaher currently trades at a P/E ratio of 37.8 and shows a year-to-date decline of ~17%, though InvestingPro analysis indicates the stock remains undervalued at current levels. The company holds a "GOOD" financial health score and stands as a prominent player in the Life Sciences Tools & Services industry, with 10 additional ProTips available to subscribers.
Waters Corporation (NYSE:WAT) and Bio-Techne (NASDAQ:TECH) carry Hold ratings with price targets of $299.57 and $51.59.
In other recent news, Danaher Corporation announced its fourth-quarter 2025 earnings, which exceeded Wall Street expectations. The company reported an earnings per share (EPS) of $2.23, outperforming the projected $2.14. Revenue for the quarter was $6.84 billion, slightly surpassing the anticipated $6.79 billion. Additionally, Danaher has entered into a definitive agreement to acquire Masimo Corporation for $9.9 billion in an all-cash deal, valuing Masimo at approximately 18 times estimated 2027 EBITDA. This acquisition highlights Danaher’s strategic expansion in the patient monitoring sector. Furthermore, Danaher declared a quarterly cash dividend of $0.40 per share, payable on April 24, 2026, to shareholders of record as of March 27, 2026. In corporate governance updates, Jessica L. Mega retired from Danaher’s board of directors, citing other professional commitments as the reason for her departure. These developments reflect Danaher’s ongoing financial and strategic activities.
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