Danaher Corporation (DHR) Leaves Investors Bruised, But Is It Still Worth Buying?

On November 29, 2019, Danaher Corporation (NYSE:DHR) shares lost -0.42% or -0.61 points to close at $145.98 with a thin trading volume of 1.998 million shares. It opened the trading session at $146.66, the shares rose to $147 and dropped to $145.21, the range by which the price of stock traded the whole day. The company now has a market cap of $105 billion and currently has 717.18 million outstanding shares. Danaher Corporation (DHR) stock has accumulated 5.59 percent of market value in 21 trading days.

DHR stock’s trailing 3-year beta is 0.92, meaning there will be a lower rate of return, although posing a lower risk. The part of a firm’s profit given to each outstanding share of regular stock was $3.36 share in the trailing 52 weeks. The stock’s value surged 41.56 percent year to date (YTD) compared to a rise of 36.47 percent in 52 week’s period. The firm’s shares are still trading -0.92 percent below its 1-year high of $147.33 and 54.33 percent up from 52-week low of $94.59. The average consensus ranking on the company is 1.8, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a buy.

Danaher Corporation (DHR) is most likely going to rise 4.61 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $174-month high price target. This represents a whopping 19.19 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $152, which means a return possibility of 4.12 percent in comparison with the closing price of the stock of $145.98 on November 29. The lowest price set for the stock is $136 — just above -6.84 percent from DHR share price now.

Past records have indicated that shares in Danaher Corporation rose on 20 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of DHR’s Q4 earnings on January 30. Analysts are predicting revenue to climb 3 percent to $5.52B in the financial fourth quarter, while EPS will soar by about 3.91 percent to $1.33 per share. In the last quarter, it earnings of $1.16 per share came better than the $1.01892, adjusted, expected by Thomson Reuters consensus estimate. Revenue for the quarter was $5.04B, topping the $5.02B analysts had expected. Earnings are seen to rise by 6.4 percent this year, 17.63 percent in the coming year and the trend continues by 10.9 percent every year in the next 5 years.

Let’s take a glimpse at some insider activity at Danaher Corporation (NYSE:DHR) and observe the pattern. The earliest insider trade happened on 08/23/2019. RALES MITCHELL P gathered a total of 2.5 thousand shares of the firm at average share price of $139.52. The total amount for the purchase was set at $348.8 thousand. On completing this exchange, the Chairman of Exec. Committee account balance was 36.05 million shares. The stock grew 4.63 percent from that insider purchase. On 07/26/2019, Ellis Brian W, Senior Vice President – GC, did a sale of 1.01 thousand shares at a price of $144.04 per share. This got rid of 145.48 thousand shares from the insider’s fortune and the stock experienced a 1.35 percent rally in price since the news became public. This exchange saw 20.89 thousand shares get out from the Senior Vice President – GC account.

On 07/25/2019, SVP-Chief Accounting Officer LUTZ ROBERT S recorded a sale transaction valued at $2.1 million. The sale at $143.28 a share has eliminated 14.67 thousand shares from the insider’s portfolio position. Meanwhile, shares price witnessed 1.88 percent increase since the transaction reporting date. The company insider is left with 21.05 thousand shares remaining in the account. Lalor Angela S, who works as SVP, Human Resources at the company, performed a sale of 20 thousand shares in a transaction worth $2.85 million. The disposal recorded on 07/23/2019 was priced at $142.3 per share. The stock price soared 2.59 percent since the transaction. Lalor Angela S currently holds a stake of 38.52 thousand in DHR stock which is worth $5.62 million after the insider selling.

The stock is lingering around the initial support level of $145.13. After this, the following support is at the zone of $144.27. Up until the time the DHR stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 66.21 on the daily chart, and this may be a cause for concern. In case the price goes below $144.27 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $146.92 level may cause a pull-back move approaching $147.85 mark.

Danaher Corporation (DHR) shares are trading at a P/E ratio of 43.2 times earnings posted in the trailing 12 months. The industry DHR deals with has an average P/E of 46.6. Its P/B ratio is standing at 3.4X compared to the 4.8 industry average. It is additionally sporting a 5.2 on the Price-to-Sales ratio, compared to the industry’s P/S average of 4.1. Danaher Corporation has a 55.6% gross profit margin, with its operating margin around 16.7%. Alongside this, the company’s net profit margin currently stands at 11.9%.