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Danaher Corp DHR Stock Quote

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Morningstar‘s Stock Analysis DHR

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Danaher Divesting Environmental and Applied Solutions Segment and Mildly Raising 2022 Outlook

Julie Utterback, CFA Senior Equity Analyst

Analyst Note

| Julie Utterback, CFA |

In advance of its investor day on Thursday, Danaher announced the planned divestiture of its environmental and applied solutions group in late 2023 and a slight increase in its 2022 outlook, which appear to be pushing up shares. However, our fair value estimate may not change materially unless Danaher can realize more value for the asset at the time of the spinoff than we recognize in our combined model. Positively though, we appreciate this divestiture plan strategically, as it may slightly increase the durability of Danaher's switching cost moat source by focusing exclusively on life sciences and diagnostics. While we suspect our narrow moat and stable moat trend ratings will not change materially on this business mix shift, our capital allocation rating (currently on the strong end of Standard) may rise to Exemplary based on our increasing appreciation for Danaher's investment strategy and anticipated execution after this divestiture.

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Key Statistics DHR

Company Profile DHR

Business Description

In 1984, Danaher’s founders transformed a real estate organization into an industrial-focused manufacturing company. Through a series of mergers, acquisitions, and divestitures, including the Fortive separation in 2016, Danaher now focuses primarily on manufacturing scientific instruments and consumables in three segments: life sciences, diagnostics, and environmental and applied solutions. In late 2019, Danaher separated from its dental business through an initial public offering process, and in early 2020, it acquired GE’s Biopharma business, now called Cytiva, which added to its life sciences segment.

2200 Pennsylvania Avenue, North West, Suite 800W
Washington, DC, 20037-1701
T +1 202 828-0850
Industry Diagnostics & Research
Most Recent Earnings Jun 30, 2022
Fiscal Year End Dec 31, 2022
Employees 80,000

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