Danaher Rises on Hiked Profit Views
NEW YORK (
) --
Danaher
(DHR) - Get Report
stock spiked by as much as 4.5% to $80.80 Tuesday morning after the company raised its first-quarter earnings guidance to 90 cents a share "or above."
Danaher had previously forecast a per-share profit at or above the high end of a range between 77 cents and 82 cents. On average, analysts were expecting the company to post 83 cents a share in the quarter, which ends April 2. All figures exclude items.
In a press statement, Danaher said the revised outlook will be part of CEO H. Lawrence Culp's presentation at a meeting with investors in Toronto later Tuesday.
Last week, the Washington, D.C.-based conglomerate announced a joint venture agreement with
Cooper Industries
(CBE)
, which was looked at favorably by at least one analyst.
"We think the agreement by Danaher and Cooper Industries to combine select parts of their respective tool manufacturing businesses in a joint venture will enhance profitability for both companies," wrote Standard & Poor's Efraim Levy in a note to investors.
Levy cited the efficiencies from bringing together complementary businesses and pointed out that Danaher will be getting a $90 million dividend payment from the partnership. "We believe its strategy for integrating and improving acquisitions will be applicable to the joint venture," Levy wrote.
On March 26, Danaher and Cooper said they signed an agreement to combine certain operations of their tools-manufacturing businesses.
Danaher and Cooper expect the combination to generate "significant" cost and revenue synergies.
Cooper and Danaher will each have a 50% voting interest in the joint venture and an equal number of representatives on its board of directors. The 2009 sales of the two tools businesses on a combined, non-GAAP basis were about $1.2 billion.
S&P expects the deal to close int eh second quarter.
Cooper stock was gaining 1.4% to $47.40 Tuesday morning.
-- Reported by Andrea Tse in New York
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