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Danaher Corp. (DHR)
NYSE:DHR
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Danaher
(NYSE:DHR)65Neutral
Positive Factors
Cost Savings Initiative
A new $150 million cost savings initiative is anticipated to generate significant annual pre-tax savings for Danaher Corporation.
Operational Execution
Danaher Corporation's update aligns with prior expectations, reinforcing confidence in their operational execution.
Negative Factors
Earnings Guidance
Shares have been under pressure after the company reported fourth-quarter results and issued 2025 guidance, with a notable decline compared to large-cap peers.
Danaher (DHR) vs. S&P 500 (SPY)
Market Cap
$147.01B
Dividend Yield0.53%
Average Volume (3M)5.09M
Price to Earnings (P/E)38.9
Beta (1Y)0.85
Revenue Growth-13.50%
EPS Growth-17.25%
CountryUS
Employees63,000
SectorHealthcare
Sector Strength74
IndustryMedical Diagnostics & Screening
Share Statistics
EPS (TTM)5.29
Shares Outstanding714,709,840
10 Day Avg. Volume4,752,754
30 Day Avg. Volume5,085,978
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)6.16
Price to Cash Flow (P/CF)18.20
P/FCF Ratio18.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$263.87Price Target Upside28.15% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering18
Danaher Business Overview & Revenue Model
Company DescriptionFounded in 1969 and headquartered in Washington, DC, Danaher Corp. engages in manufacturing, designing and marketing of professional, medical, industrial and commercial products and services. The company operates through three segments, including Life Sciences, Diagnostics, and Environmental & Applied Solutions.
How the Company Makes MoneyDanaher makes money primarily through the sale of its products and services across its three main segments: Life Sciences, Diagnostics, and Environmental & Applied Solutions. In Life Sciences, Danaher generates revenue from laboratory instruments, reagents, consumables, software, and services that support scientific research and clinical diagnostics. The Diagnostics segment focuses on providing medical diagnostic equipment and consumables used in hospitals, laboratories, and other healthcare settings. This includes instruments for clinical analysis and medical imaging. The Environmental & Applied Solutions segment offers products and services that help ensure water quality and improve industrial productivity, including water disinfection systems and quality management solutions. Danaher's revenue model relies on a combination of direct sales, long-term service agreements, and consumable product sales, with a significant emphasis on recurring revenue through consumables and services. The company also engages in strategic acquisitions to expand its product offerings and enter new markets, which further contributes to its revenue growth.
Danaher Financial Statement Overview
Summary
Danaher shows robust operational efficiency with strong EBIT and EBITDA margins. However, declining revenue growth and cash flow generation highlight challenges. The balance sheet remains strong with a moderate debt-to-equity ratio, but profitability needs improvement.Income Statement
The TTM data shows a stable gross profit margin of 59.5%, reflecting strong cost management. However, the net profit margin has decreased to 16.3% from 19.9% in the previous year. Revenue shows a decline of 24.1% compared to 2022, indicating potential challenges in sales growth. EBIT and EBITDA margins are robust at 20.4% and 28.3% respectively, showcasing operational efficiency.75
Positive
Balance Sheet
The company maintains a strong equity position with an equity ratio of 63.9%. The debt-to-equity ratio is moderate at 0.32, indicating a balanced leverage approach. Return on equity is solid at 7.9%, though it has decreased from 8.9% in the prior year, suggesting a need to improve profitability.80
Positive
Cash Flow
Operating cash flow remains strong, with a slight decrease from the previous year, resulting in an operating cash flow to net income ratio of 1.71. Free cash flow decreased, impacting the free cash flow to net income ratio of 1.36. The free cash flow growth rate shows a decline of 8.4%, highlighting challenges in cash generation.70
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 23.88B | 23.89B | 31.47B | 29.45B | 22.28B | Gross Profit |
| 14.21B | 14.03B | 18.95B | 17.95B | 12.47B | EBIT |
| 4.86B | 5.20B | 8.69B | 7.46B | 4.23B | EBITDA |
| 4.86B | 7.50B | 9.71B | 10.01B | 6.59B | Net Income Common Stockholders |
| 3.90B | 4.76B | 7.21B | 6.43B | 3.65B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 2.08B | 5.86B | 6.00B | 2.59B | 6.04B | Total Assets |
| 77.54B | 84.49B | 84.35B | 83.18B | 76.16B | Total Debt |
| 16.00B | 19.54B | 19.68B | 22.18B | 21.20B | Net Debt |
| 13.93B | 13.67B | 13.68B | 19.59B | 15.17B | Total Liabilities |
| 27.99B | 31.00B | 34.26B | 38.01B | 36.38B | Stockholders Equity |
| 49.54B | 53.49B | 50.08B | 45.17B | 39.77B |
| Cash Flow | Free Cash Flow | |||
| 5.30B | 5.78B | 7.37B | 7.06B | 5.42B | Operating Cash Flow |
| 6.69B | 7.16B | 8.52B | 8.36B | 6.21B | Investing Cash Flow |
| -1.98B | -7.08B | -2.23B | -12.99B | -21.24B | Financing Cash Flow |
| -8.38B | -273.00M | -2.57B | 1.29B | 1.01B |
Danaher Technical Analysis
Negative
205.91
Price Trends
223.61
Negative
234.73
Negative
248.76
Negative
Market Momentum
-5.06
Negative
36.90
Neutral
40.01
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DHR, the sentiment is Negative. The current price of 205.91 is below the 20-day moving average (MA) of 207.24, below the 50-day MA of 223.61, and below the 200-day MA of 248.76, indicating a bearish trend. The MACD of -5.06 indicates Negative momentum. The RSI at 36.90 is Neutral, neither overbought nor oversold. The STOCH value of 40.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DHR.
Danaher Risk Analysis
Danaher disclosed 44 risk factors in its most recent earnings report. Danaher reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Danaher Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $34.00B | 27.35 | 23.77% | 0.89% | 9.38% | 40.38% | |
74 Outperform | $213.34B | 33.27 | 33.90% | 0.55% | -32.60% | -28.55% | |
73 Outperform | $65.60B | 37.95 | 6.85% | 1.70% | 5.89% | 42.05% | |
70 Outperform | $194.88B | 31.23 | 12.78% | 0.30% | 0.05% | 6.87% | |
65 Neutral | $147.01B | 38.89 | 7.87% | 0.53% | -13.50% | -17.25% | |
64 Neutral | $79.19B | 19.31 | 108.62% | 1.84% | -18.72% | ― | |
49 Neutral | $7.05B | 0.34 | -55.09% | 2.46% | 25.27% | -3.43% |
* Healthcare Sector Average
Performance Comparison
DHR
Danaher
205.91
-45.90
-18.23%
MMM
3M
145.86
70.23
92.86%
BDX
Becton Dickinson
224.27
-7.40
-3.19%
GE
GE Aerospace
198.77
72.40
57.29%
RMD
Resmed
231.48
48.85
26.75%
TMO
Thermo Fisher
516.57
-73.32
-12.43%
Danaher Earnings Call Summary
Earnings Call Date: Jan 29, 2025 | % Change Since: -16.92% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with strong cash flow and innovation driving positive sentiment, but challenges in core revenue growth and specific segment declines, particularly in Diagnostics and the China market, created headwinds.Highlights
Strong Free Cash Flow and Share Repurchases
Danaher Corporation generated $5.3 billion of free cash flow in 2024, marking the 33rd consecutive year of free cash flow to net income conversion exceeding 100%. Additionally, the company deployed approximately $7 billion towards repurchasing 28 million shares of its common stock.
Bioprocessing Business Momentum
The bioprocessing business exhibited high-single-digit core revenue growth and sustained positive momentum with high-single-digit sequential order growth for six consecutive quarters.
Innovative Product Launches
Significant innovations were introduced, such as Cytiva's Sefia cell therapy manufacturing platform, Beckman Coulter's Cydem VT Automated Cell Culture System, and the DxI 9000 immunoassay analyzer, enhancing customer capabilities and advancing critical healthcare solutions.
Adjusted Earnings Per Share Increase
Adjusted diluted net earnings per common share increased by 2.4% year-over-year to $2.14 in the fourth quarter.
Lowlights
Core Revenue Decline
Overall core revenue declined by 1.5% in 2024, with specific challenges in certain segments such as Life Sciences and Diagnostics.
Diagnostics Segment Revenue Decrease
Core revenue in the Diagnostics segment decreased by 2% in the fourth quarter, impacted by volume-based procurement in China and a slower start to the respiratory season.
Weakness in China Market
Continued challenges in China affected performance, with mid-single-digit core revenue declines due to a difficult funding environment and aggressive volume-based procurement measures.
Company Guidance
During the fourth quarter 2024 earnings call, Danaher Corporation provided comprehensive guidance for the upcoming year, reflecting both achievements and anticipated challenges. The company reported sales of $6.5 billion for the quarter, with a 1% core revenue growth, and adjusted diluted net earnings per share of $2.14, up 2.4% year-over-year. For the full year 2024, sales totaled $23.9 billion with a 1.5% decline in core revenue. The adjusted operating profit margin was flat at 28.6%, while free cash flow reached $5.3 billion, marking a conversion ratio of approximately 135%. Looking forward to 2025, Danaher projected a 3% core revenue growth with a 2% revenue headwind due to currency fluctuations and anticipated an adjusted operating profit margin of 28.5%. The company also highlighted strategic investments and innovations, including acquisitions and new product launches in biotechnology, life sciences, and diagnostics, aiming for sustainable long-term growth and shareholder value.Danaher Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Danaher Appoints Charles W. Lamanna to Board
Neutral
Feb 20, 2025
On February 20, 2025, Danaher Corporation appointed Charles W. Lamanna to its Board of Directors, with his term set to expire at the 2025 annual meeting of shareholders. Mr. Lamanna was also named to the Science & Technology Committee and deemed independent by the Board. Additionally, Danaher amended its 2007 Omnibus Incentive Plan to fully vest stock options and units upon a participant’s death or disability termination, providing clarity and security for stakeholders involved.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.