Sigma Aldrich

In: Business and Management

Submitted By h123p456
Words 357
Pages 2
Sigma-Aldrich is a leading Life Science and High Technology company that is based out of St. Louis. Their biochemical, organic chemical products, kits and services are used in scientific research, including genomic and proteomic research, biotechnology, and pharmaceutical development. As one might expect, Sigma-Aldrich has a unique customer base. Their customers include life science companies, university, government institutions, hospitals, and industrial manufacturers. Currently, the Company operates in 40 countries and has approximately 9,000 employees. Sigma-Aldrich is organized into four business units. They are Essentials, SAFC, Bio Tech, and Specialties. In terms of percentage breakdown, specialties is their biggest unit accounting for approximately 37% of sales.

With more than 1.3 million customers, Sigma-Aldrich has a unique customer base. The following graph shows their customer breakdown in terms of percentages.

Sigma Aldrich is a great company and has done really well in the past, but we expect this this pattern to change. We are expecting sigma to see their revenues threatened by austerity in areas such as Europe and Asia. This is because of poor economical conditions and tough competition. Our research has also shown decreasing asset turnover and days sales outstanding. Because of this, we think, sigma will be forced to give favorable terms to its customers showing a definite overall weakness in the company. We have also noticed their inefficient use of leverage. Considering that most of Sigma’s growth comes from acquisitions, we believe, this is the best time to take advantage of low interest rates. As seen in the past, strong dollar hurts sigma’s bottom line. We expect the US dollar to get stronger in the near future, which will in turn affect sigma in a negative way.

Our fundamental analysis suggests slow growth and tough competition in the…...

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