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Danaher Corporation (DHR - Analyst Report) is set to report its first quarter 2013 results on Apr 18th. The company’s reported EPS in the last quarter was 87 cents, in line with the Zacks Estimate. Let’s see how things are shaping up for this announcement.

Why a Likely Positive Surprise?

Our proven model shows that Danaher is likely to beat earnings because it has the right combination of two key ingredients.

Positive Zacks ESP: Earnings Surprise Prediction or Zacks Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is at 1.32%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.

Zacks #3 Rank (Neutral): Note that stocks with Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings. The Sell-rated stocks (#4 and #5) should never be considered going into an earnings announcement. 

The combination of Danaher’s Zacks Rank # 3 (Hold) and 1.32% ESP makes us very confident in looking for a positive earnings beat on Apr 18th.

What is Driving the Better Than Expected Earnings?

Danaher expects to benefit from the multiple acquisitions made during the year. The company is also deriving better than expected synergies from the merger of Beckman Coulter. Furthermore, the company is also able to drive organic growth and margin expansion, driven by its DBS system. In the last quarter, the company’s total sales were up 5.5% year over year.

The positive trend is seen in the trailing four-quarter average surprise of 1.42%. Danaher reported revenue growth across its five segments. The company is also benefiting from product innovations and go-to-market initiatives.

Other Stocks to Consider

Danaher is not the only firm looking up this earnings season. We also see likely earnings beats coming from these 3 industry peers:

Crane Co. (CR - Snapshot Report), Earnings ESP of +0.97% and Zacks Rank #2 (Buy).

Honeywell International (HON - Analyst Report), Earnings ESP of +0.88% and Zacks Rank #2 (Buy).

Tyco International (TYC - Analyst Report), Earnings ESP of +2.50% and Zacks Rank #3 (Hold).

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