Danaher Corporation Stock Buy Recommendation Reiterated (DHR)
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- DANAHER CORP has improved earnings per share by 5.5% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, DANAHER CORP increased its bottom line by earning $2.77 versus $2.52 in the prior year. This year, the market expects an improvement in earnings ($3.17 versus $2.77).
- DHR's debt-to-equity ratio is very low at 0.25 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.15, which illustrates the ability to avoid short-term cash problems.
- The gross profit margin for DANAHER CORP is rather high; currently it is at 56.40%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 12.42% is above that of the industry average.
- Net operating cash flow has increased to $961.14 million or 37.31% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -2.23%.
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
--Written by a member of TheStreet Ratings Staff. It's Official: Action Alerts PLUS beats the S&P 500 with Dividends Reinvested! Cramer and Link were up 16.72% in 2012. Were you? See what they are trading for 14-days FREE
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