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Danaher (DHR) Dips More Than Broader Markets: What You Should Know

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  • DHR-PA

Danaher (DHR) closed at $312.94 in the latest trading session, marking a -0.99% move from the prior day. This move lagged the S&P 500's daily loss of 0.85%. At the same time, the Dow lost 0.17%, and the tech-heavy Nasdaq lost 0.05%.

Prior to today's trading, shares of the industrial and medical device maker had gained 3.29% over the past month. This has outpaced the Conglomerates sector's loss of 4.04% and the S&P 500's loss of 0.97% in that time.

Wall Street will be looking for positivity from Danaher as it approaches its next earnings report date. The company is expected to report EPS of $2.50, up 20.19% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.76 billion, up 14.82% from the year-ago period.

DHR's full-year Zacks Consensus Estimates are calling for earnings of $9.80 per share and revenue of $29.07 billion. These results would represent year-over-year changes of +55.31% and +30.47%, respectively.

Investors might also notice recent changes to analyst estimates for Danaher. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Danaher is currently a Zacks Rank #3 (Hold).

In terms of valuation, Danaher is currently trading at a Forward P/E ratio of 32.24. Its industry sports an average Forward P/E of 17.25, so we one might conclude that Danaher is trading at a premium comparatively.

Meanwhile, DHR's PEG ratio is currently 2.36. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Diversified Operations was holding an average PEG ratio of 1.69 at yesterday's closing price.

The Diversified Operations industry is part of the Conglomerates sector. This group has a Zacks Industry Rank of 81, putting it in the top 32% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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