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Danaher Corporation (DHR - Free Report) reported impressive second-quarter 2022 results. DHR’s earnings surpassed the Zacks Consensus Estimate by 17.4%. Its sales beat in the quarter was 6.4%.
In the reported quarter, Danaher’s adjusted earnings were $2.76 per share, surpassing the Zacks Consensus Estimate of $2.35. The bottom line increased 12.2% from the year-ago quarter’s figure of $2.46, primarily on sales growth.
Revenue Details
In the quarter under review, Danaher’s net sales were $7,751 million, reflecting year-over-year growth of 7.4%. Results were driven by solid segmental performances. Organic sales in the quarter increased 9.5%, while acquisitions boosted sales 2.5%. Foreign-currency translations had an adverse impact of 4.5% on the quarterly sales.
The pandemic-induced demand for products boosted sales 1.5%, while base business core sales (excludes the impacts of COVID-19 testing revenues) growth was 8% in the quarter. Danaher’s top line surpassed the Zacks Consensus Estimate of $7,288 million.
DHR reports net sales under three segments, namely Life Sciences, Diagnostics and Environmental & Applied Solutions. The segmental information is briefly discussed below:
Revenues from the Life Sciences segment totaled $3,967 million, rising 6% year over year. Acquisitions/divestments contributed 4% to sales growth, while unfavorable foreign-currency translations lowered sales 5%. Core sales grew 7% year over year.
Revenues from the Diagnostics segment grossed $2,561 million, increasing 9.5% year over year. The improvement came on the back of a 12.5% rise in core sales. Foreign currency woes affected 4%.
Revenues from the Environmental & Applied Solutions segment totaled $1,223 million, up 6.5% year over year. Core sales expanded 10%, while foreign currency translation had a negative impact of 3.5%.
In the second quarter, Danaher’s cost of sales increased 7.4% year over year to $3,030 million. The gross profit of $4,721 million grew 7.4% year over year, while the margin of 60.9% remained unchanged year over year.
Selling, general and administrative expenses of $2,085 million witnessed a year-over-year increase of 6.1%. Research and development expenses were $431 million, up 1.2%.
Operating profit in the quarter under review increased 10% year over year to $2,205 million. The operating margin increased 60 bps to 28.4% in the quarter. Interest expenses totaled $51 million, down 17.7% from the year-ago quarter’s level.
Balance Sheet and Cash Flow
Exiting the second quarter, Danaher had cash and cash equivalents of $3,984 million, up 7.2% from $3,717 million at the end of the last reported quarter. The long-term debt balance decreased 7.9% sequentially to $20,052 million.
In the first six months of 2022, Danaher made repayments of borrowings worth $265 with a maturity of more than 90 days. Net proceeds from borrowings (with a maturity of less than 90 days) totaled $669 million in the period.
Danaher generated net cash of $3,968 million from operating activities (continuing operations) in the first six months of 2022, reflecting a year-over-year decrease of 0.6%. Capital used for purchasing property, plant and equipment totaled $546 million, decreasing 1.8% year over year. Free cash flow (continuing operations) was $1,711 million, decreasing 5.8% year over year.
DHR paid out dividends worth $411 million to its shareholders in the first six months of 2022, up 14.2% on a year-over-year basis.
Outlook
Danaher expects year-over-year core revenue growth in low-single digits for the third quarter of 2022 and mid-single digits for 2022.
The COVID-related testing impacts are anticipated to boost sales in mid-single digits in the third quarter and low-single digits for the whole year.
Base business core sales growth is predicted in high-single digits for the third quarter and high-single digits for 2022.
In the past 60 days, Griffon’s earnings estimates have increased 28.9% for fiscal 2022 (ending September 2022). The stock has rallied 19.4% in the past six months.
Greif, Inc. (GEF - Free Report) presently sports a Zacks Rank of 1, currently. GEF delivered a trailing four-quarter earnings surprise of 22.9%, on average.
GEF’s earnings estimates have increased 17.8% for fiscal 2022 (ending October 2022) in the past 60 days. Its shares have risen 11.4% in the past six months.
Titan International, Inc. presently flaunts a Zacks Rank of 1. Its earnings surprise in the last four quarters was 56.4%, on average.
In the past 60 days, TWI’s earnings estimates have increased 43.3% for 2022. The stock has surged 59.9% in the past six months.
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Danaher's (DHR) Q2 Earnings & Revenues Beat, Increase Y/Y
Danaher Corporation (DHR - Free Report) reported impressive second-quarter 2022 results. DHR’s earnings surpassed the Zacks Consensus Estimate by 17.4%. Its sales beat in the quarter was 6.4%.
In the reported quarter, Danaher’s adjusted earnings were $2.76 per share, surpassing the Zacks Consensus Estimate of $2.35. The bottom line increased 12.2% from the year-ago quarter’s figure of $2.46, primarily on sales growth.
Revenue Details
In the quarter under review, Danaher’s net sales were $7,751 million, reflecting year-over-year growth of 7.4%. Results were driven by solid segmental performances. Organic sales in the quarter increased 9.5%, while acquisitions boosted sales 2.5%. Foreign-currency translations had an adverse impact of 4.5% on the quarterly sales.
The pandemic-induced demand for products boosted sales 1.5%, while base business core sales (excludes the impacts of COVID-19 testing revenues) growth was 8% in the quarter. Danaher’s top line surpassed the Zacks Consensus Estimate of $7,288 million.
DHR reports net sales under three segments, namely Life Sciences, Diagnostics and Environmental & Applied Solutions. The segmental information is briefly discussed below:
Revenues from the Life Sciences segment totaled $3,967 million, rising 6% year over year. Acquisitions/divestments contributed 4% to sales growth, while unfavorable foreign-currency translations lowered sales 5%. Core sales grew 7% year over year.
Revenues from the Diagnostics segment grossed $2,561 million, increasing 9.5% year over year. The improvement came on the back of a 12.5% rise in core sales. Foreign currency woes affected 4%.
Revenues from the Environmental & Applied Solutions segment totaled $1,223 million, up 6.5% year over year. Core sales expanded 10%, while foreign currency translation had a negative impact of 3.5%.
Danaher Corporation Price and Consensus
Danaher Corporation price-consensus-chart | Danaher Corporation Quote
Margin Profile
In the second quarter, Danaher’s cost of sales increased 7.4% year over year to $3,030 million. The gross profit of $4,721 million grew 7.4% year over year, while the margin of 60.9% remained unchanged year over year.
Selling, general and administrative expenses of $2,085 million witnessed a year-over-year increase of 6.1%. Research and development expenses were $431 million, up 1.2%.
Operating profit in the quarter under review increased 10% year over year to $2,205 million. The operating margin increased 60 bps to 28.4% in the quarter. Interest expenses totaled $51 million, down 17.7% from the year-ago quarter’s level.
Balance Sheet and Cash Flow
Exiting the second quarter, Danaher had cash and cash equivalents of $3,984 million, up 7.2% from $3,717 million at the end of the last reported quarter. The long-term debt balance decreased 7.9% sequentially to $20,052 million.
In the first six months of 2022, Danaher made repayments of borrowings worth $265 with a maturity of more than 90 days. Net proceeds from borrowings (with a maturity of less than 90 days) totaled $669 million in the period.
Danaher generated net cash of $3,968 million from operating activities (continuing operations) in the first six months of 2022, reflecting a year-over-year decrease of 0.6%. Capital used for purchasing property, plant and equipment totaled $546 million, decreasing 1.8% year over year. Free cash flow (continuing operations) was $1,711 million, decreasing 5.8% year over year.
DHR paid out dividends worth $411 million to its shareholders in the first six months of 2022, up 14.2% on a year-over-year basis.
Outlook
Danaher expects year-over-year core revenue growth in low-single digits for the third quarter of 2022 and mid-single digits for 2022.
The COVID-related testing impacts are anticipated to boost sales in mid-single digits in the third quarter and low-single digits for the whole year.
Base business core sales growth is predicted in high-single digits for the third quarter and high-single digits for 2022.
Zacks Rank & Stocks to Consider
Danaher currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies are discussed below.
Griffon Corporation (GFF - Free Report) presently sports a Zacks Rank #1 (Strong Buy). GFF’s earnings surprise in the last four quarters was 97%, on average. You can see the complete list of today’s Zacks #1 Rank stocks.
In the past 60 days, Griffon’s earnings estimates have increased 28.9% for fiscal 2022 (ending September 2022). The stock has rallied 19.4% in the past six months.
Greif, Inc. (GEF - Free Report) presently sports a Zacks Rank of 1, currently. GEF delivered a trailing four-quarter earnings surprise of 22.9%, on average.
GEF’s earnings estimates have increased 17.8% for fiscal 2022 (ending October 2022) in the past 60 days. Its shares have risen 11.4% in the past six months.
Titan International, Inc. presently flaunts a Zacks Rank of 1. Its earnings surprise in the last four quarters was 56.4%, on average.
In the past 60 days, TWI’s earnings estimates have increased 43.3% for 2022. The stock has surged 59.9% in the past six months.