Back to top

Image: Shutterstock

Danaher (DHR) Up 14% in 6 Months: What's Driving the Stock?

Read MoreHide Full Article

Shares of Danaher Corporation (DHR - Free Report) have gained approximately 14% in the past six months, outperforming the industry’s 11.7% increase. Strength across segments, benefits from the DBS initiatives and inorganic activities have driven the company’s shares.

Zacks Investment Research
Image Source: Zacks Investment Research


Danaher’s core Life Sciences segment is aided by robust activity in the bioprocessing business and strength in instrument businesses, led by SCIEX, Leica Microsystems and Beckman Coulter Life Sciences. In the first nine months of 2022, revenues from the segment jumped 6.5% year over year.

Robust growth in Beckman Coulter Diagnostics and Molecular Diagnostics is driving Danaher’s Diagnostics segment’s performance. Healthy demand for products related to respiratory testing is also a key catalyst to the segment’s growth. Revenues from the Diagnostics segment rose 13.2% year over year in the first nine months of 2022.

Strength in food, beverage and consumer end markets is fueling the Environmental & Applied Solutions segment’s growth. Solid demand for analytical chemistries, consumables and steady activity levels in municipal and industrial projects are other tailwinds for the segment. Revenues from the segment increased 4.8% year over year in the first nine months of 2022.

Danaher has been able to reduce the impact of supply-chain constraints and inflationary pressure through its DBS initiatives, which helps the company focus more on product innovation, superior product quality and efficient workforce building.

Inorganic activities are boosting Danaher’s competency.  In August 2021, the company acquired Aldevron, strengthening its foothold in the genomic medicine field. The company added Vanrx Pharmasystems and Swift Biosciences to its portfolio in first-quarter 2021. In third-quarter 2022, acquisitions boosted the company’s sales by 1.5%.

Danaher’s consistent measures to reward its shareholders through dividend payments also boosted its shares. In 2021, the company used $742 million to pay out dividends, reflecting year-over-year growth of 20.7%. In the first nine months of 2022, DHR paid out dividends worth $615 million, reflecting an increase of 11.6% on a year-over-year basis. In February 2022, the company announced a hike of 4 cents per share in the quarterly dividend rate.

Zacks Rank & Key Picks

Danaher currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks worth considering are as follows:

Applied Industrial Technologies, Inc. (AIT - Free Report) presently sports a Zacks Rank #1 (Strong Buy). AIT delivered a trailing four-quarter earnings surprise of 24.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks.

Applied Industrial has an estimated earnings growth rate of 14.3% for the current fiscal year. The stock has gained 38% in the past six months.

IDEX Corporation (IEX - Free Report) presently carries a Zacks Rank #2 (Buy). The company pulled off a trailing four-quarter earnings surprise of 5.7%, on average.

IDEX has an estimated earnings growth rate of 28.3% and 6.1% for the current and next years, respectively. The stock has rallied 38% in the past six months.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Danaher Corporation (DHR) - free report >>

Applied Industrial Technologies, Inc. (AIT) - free report >>

IDEX Corporation (IEX) - free report >>

Published in