The 2014 All-America Research Team: Life Science & Diagnostic Tools, No. 1: Tycho Peterson

<The 2014 All-America Research Team Tycho PetersonJ.P. MorganFirst-Place Appearances: 4

Total Appearances: 5

Analyst Debut: 2010

For a fourth consecutive year, J.P. Morgan researcherTycho Petersonclaims top honors on this roster. “Tycho does good work on his coverage universe and is close with management teams, allowing for very good corporate access,” avers one client. The U.S. life science and diagnostics tools sector outperformed in 2014 through mid-September, climbing 13.2 percent compared with the domestic broad market’s 7.3 percent advance. The group saw positive performance by tools companies and mixed results in the genetic analysis and diagnostics spaces, the 42-year-old analyst notes. Peterson’s highest positive conviction remains with San Diego–based Illumina, he says, thanks to the integrated-systems developer’s dominant position in next-generation genomic sequencing. Illumina’s technologies deliver both the fastest and most accurate results, and it has enjoyed explosive growth in that space. The stock has followed suit, catapulting 98.8 percent during the 12 months through mid-September, to $168.10, and far surpassing its peers’ 30.7 percent gain. He believes that a value of $230 is justified. “Tycho does in-depth research on key topics that matter for his stocks,” insists another fan. Peterson also remains favorably biased toward Sunnyvale, California’s Intuitive Surgical. “The company is ramping two new robotic surgery systems, da Vinci Xi and da Vinci Sp, coming in the second half of 2015,” he explains. The researcher’s target price for Intuitive is $550; it closed in mid-September at $468.78.