Expect more Danaher spinoffs

Article Excerpt

DANAHER CORP. $251 is a buy. The company (New York symbol DHR; Manufacturing & Industry sector; Shares outstanding 715.9 million; Market cap: $179.7 billion; Dividend yield: 0.4%; Takeover Target Rating: Medium; www.danaher.com) is a leading maker of precision-testing equipment and tools. Its major customers include medical research labs and municipal water utilities. Beckman Coulter, ChemTreat, Pantone and KaVo Kerr are among its leading brands. The company has completed two separate spinoffs in the past few years: industrial products maker Fortive Corp. (New York symbol FTV) in July 2016; and dental equipment specialist Envista Holdings Corp. (New York symbol NVST) in September 2019. Since July 2016, Danaher’s stock has jumped over 225% compared to just 82% for the S&P 500 Index. Danaher also uses acquisitions of smaller firms to enhance its expertise and enter new markets. It’s likely the company will spin off some of these smaller businesses as they mature. The stock trades at a high, but still acceptable, 24.8 times the $10.29 a share the company should earn in 2022. It…

You are trying to access subscriber-only content.

To read this article, you may subscribe or sign in.
If you are already a subscriber, log in here.

If you wish to become a subscriber, click here. Or you may enjoy access to all our publications when you become a Member of Pat McKeough's Inner Circle Pro.