Thermo Fisher Scientific (NYSE:TMO) provides laboratory equipment, consumables, and services predominantly in the healthcare sector but in other manufacturing applications as well. After several years of successful growth by acquisition, the company is shifting more toward organic growth, especially through expanding its contract development and manufacturing, or CDMO, capabilities. Additionally, Thermo is demonstrating success at growing the business globally in regions where other companies have been less successful lately. Thermo exhibited high single-digit sales growth in its most recent earnings release, and I expect this to continue without major M&A activity.

Shares of Thermo Fisher, like many of its peers in the Life Sciences Tools & Services industry, are trading at a high valuation based on P/E. Thermo also shares a miserly dividend policy with its industry peers. With a quarterly payout of $0.19/share, the company's payout ratio is only 6% of 2019 earnings for a dividend yield of 0.25%.

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