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Reasons Why Danaher (DHR) Should be in Your Portfolio Now

Danaher Corporation DHR is well poised for growth courtesy of strength across its end markets, strategic acquisitions and its focus on improving the product line and operational excellence.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

The company has a market capitalization of $180.7 billion. In the past six months, the stock has gained 16.5% compared with the industry’s growth of 5.4%. DHR currently carries a Zacks Rank #2 (Buy).

Let’s delve into the factors that have been aiding the firm for a while now.

Business Strength: Danaher has been benefiting from strength in the Life Sciences segment, driven by strong demand in the academic and life science research markets. Growth in demand for plasmids, proteins, gene writing and editing solutions augurs well for the segment.

The company has been witnessing positive responses from new products like IDBS' Polar Insight and Molecular Devices' CellXpress.ai, which help accelerate the drug discovery process and bring new therapies to market faster. Also, the Diagnostics unit has been gaining from growing popularity for new solutions like Beckman Coulter's DxI 9000 next-generation immunoassay analyzer in the market.

Acquisition Benefits: DHR is focused on acquiring businesses to gain access to new customers, regions and product lines. In December 2023, Danaher acquired Abcam plc, a global supplier of protein consumables, for $5.7 billion. The inclusion of Abcam's strong innovation capabilities and robust product line are expected to help Danaher solve some of the greatest healthcare challenges. This buyout expanded the company’s Life Sciences segment. These acquisitions boosted the company’s total revenues by 0.5% in 2023.

DBS Initiatives: The Danaher Business System (DBS) initiatives, which help Danaher focus more on product innovation, superior product quality, efficient workforce building and shareholder value enhancement, are fostering the company’s growth. As part of the DBS initiatives, disciplined cost management, enhanced productivity and pricing actions have supported the company’s performance.

Shareholder-Friendly Policies: DHR is committed to rewarding its shareholders through dividend payouts. In 2023, the company paid out dividends of $821 million, up 0.4% year over year. In February 2024, the quarterly dividend rate was hiked by 12.5% to 27 cents per share.

Other Stocks to Consider

Some other top-ranked companies from the same space are discussed below.

Vector Group Ltd. VGR presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The company has a trailing four-quarter average earnings surprise of 10.2%. The Zacks Consensus Estimate for VGR’s 2024 earnings has decreased 6.9% in the past 60 days.

Carlisle Companies Incorporated CSL currently carries a Zacks Rank #2. CSL delivered a trailing four-quarter average earnings surprise of 7.6%. In the past 60 days, the Zacks Consensus Estimate for CSL’s 2024 earnings has increased 3.8%.

Cadre Holdings, Inc. CDRE presently has a Zacks Rank of 2. CDRE delivered a trailing four-quarter average earnings surprise of 45.6%. In the past 60 days, the Zacks Consensus Estimate for Cadre’s 2024 earnings has increased 7.3%.

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Danaher Corporation (DHR) : Free Stock Analysis Report

Carlisle Companies Incorporated (CSL) : Free Stock Analysis Report

Vector Group Ltd. (VGR) : Free Stock Analysis Report

Cadre Holdings, Inc. (CDRE) : Free Stock Analysis Report

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