Fortive vs Danaher Stock

Danaher Corporation (NYSE:DHR) vs. Fortive Corp. (NYSE:FTV) makes for one of the most interesting comparisons in the industrial sector. Of course, there is nothing stopping you from owning both stocks -- in fact, before the spin-off of Fortive in July 2016, investors did own both businesses as a set -- and certainly their differing investment propositions would provide diversification.However, the split has created two significantly different companies, so let's take a look at the contrasting investment cases for the two stocks.

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Danaher Corporation Stock DHR in 2017?

Danaher Corporation has always been an unusual stock in the industrial sector. A heavy exposure to healthcare and environmental solutions used to make it the go-to stock when analysts were concerned about an economic downturn. Furthermore, the more cyclical bits of the business have been bundled together and spun off into a new company called Fortive Corporation , leaving Danaher even more exposed to non-cyclical end markets. Given that analysts expect 2017 to see a bounce back in industrial growth, is Danaher a good stock to buy?

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Why Danaher Corp Stock Could Rise

It's no secret the industrial sector is experiencing difficult times, but one stock has notably outperformed in the last year. Danaher Corporation's (NYSE:DHR) mix of non-energy-related end markets coupled with upside potential from corporate actions have led the stock to outperform the both the S&P 500 and the industrial sector -- as measured by the iShares US Industrials ETF.

DHR data by YCharts.

The question is, can it continue? Here are three reasons it could.

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Danaher Corporation: Still a Safe Haven?

It's no secret that the industrial sector is facing a difficult 2016, and historically investors have favored stocks such as Danaher Corporation for their "safe haven" qualities. The company's exposure to healthcare, environmental, and dental technologies gives it defensive qualities. Moreover, 60% of its revenue comes from recurring (often high-margin consumables) sales. That said, its recent fourth-quarter results saw core revenue come in flat, when management had expected 2% growth. Which of course begs the question: Is Danaher still a safe haven?

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Is Danaher Corp a Stock to Buy in 2016?

There was nothing spectacular about Danaher Corp.'s (NYSE:DHR) investor and analyst meeting, but that might be just what investors are looking for right now. Danaher offers a compelling mix of earnings drivers in 2016, and most of them aren't reliant on the areas of the economy that have disappointed in 2015. Let's take a closer look at the investor meeting and why Danaher is an attractive stock for 2016.

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What Danaher Corporation's Management Wants You to Know

Danaher Corporation (NYSE:DHR) has comfortably outperformed the S&P 500 in the last year, but the question is: Can its run continue? Part of the answer lies in management's ability to successfully integrate Pall Corp. and complete the planned separation of Danaher into two companies. The other part lies in continuing to generate growth with its existing businesses. That said, here are five key things that management wants you to know about the company's future prospects.


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Danaher Corporation Offers a Safe Haven

Given the weakening in the industrial economy in the last six months, investors have increasingly bought into companies like Danaher for two main reasons:

First, its mix of healthcare and niche technology businesses and minimal exposure to oil and gas capital spending means it should avoid the worst of the slowdown.

Second, it's somewhat of a special-situations stock in the sense that its $13.8 billion acquisition of filtration company Pall Corp. was with the intention to separate itself into two publicly traded companies.

That said, do its recent third-quarter results back up this thesis?


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Danaher Corporation Earnings Call

It's been a difficult reporting season for the industrial sector, but Danaher Corporation stands out from its peer group in terms of results and prospects. A mix of favorable end-market exposure, corporate restructuring activity (management intends to split the company into two separate parts), and excitement over its intended $13.8 billion purchase of Pall Corp. has led to the stock's outperformance versus the market and its peer group in 2015.


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Danaher Corporation Business Model Analysis

Danaher Corporation  recently delivered a solid set of second-quarter earnings that belied some of the disappointing reports we have seen from other companies in the industrial sector in this current earnings season. The company is known for its business model of acquiring companies and then applying its Danaher Business System, or DBS, in order to increase their productivity.


Let's take a closer look at the earnings report and by use of a slideshow see if the business model is still working


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Danaher Corporation Stock Would Suit Warren Buffett

I'll cut to the chase: it's Danaher Corp.  (NYSE: DHR  ) Why? It's simple. Throughout the last 20 years or so, the conglomerate has incorporated many of the principles that made Warren Buffett so successful. In fact, I would argue that Danaher's management has run the company almost in the manner of an investment firm such as Buffett's Berkshire Hathaway. An argument which is only strengthened by the recent agreement to purchase life science filtration company Pall Corporation (NYSE: PLL  ) --a move which was suggested in a Fool article on takeover targets for 2015. Let's take a closer look at why investing in Danaher stock is something that could suit Buffett and what the Pall Corp deal means for investors.


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5 Takeaways From Danaher's Earnings

Foreign exchange matters to most companies, but it matters to more to a company like Danaher Corporation (NYSE:DHR). In truth, its underlying earnings and revenue generation were good, but the market is in no mood to forgive companies that reduce estimates, even if the downgrade was due to currency effects. Let's take a look at the five key conclusions from last week's results, and try to gauge the underlying direction of Danaher's progress in 2015.


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5 Reasons to Buy Danaher Corporation (DHR)

t's been a curious sort of year for Danaher (NYSE:DHR) investors as they watched the stock underperform the S&P 500 for much of 2014, only to come roaring back toward the end of the year. In fact, in the last six months, the stock rose 13.2% versus the S&P 500's gain of just 6.3%. What's behind the rise, and why would you want to buy Danaher stock right now?



To help answer these questions, let's take a look at the company's recent presentations and underlying trends.


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Danaher Corporation (DHR) Equity Research

It's hard not to like diversified industrial Danaher Corporation (NYSE: DHR  ) . Its management tends to underpromise and overdeliver on earnings, which is usually a good thing for investors. Meanwhile, its model of reinvesting cash flow to make earnings-enhancing acquisitions continues to serve investors handsomely. If you are looking for a solidly growing company, on attractive valuation, then Danaher might fit the bill. The recent fourth-quarter results confirmed many of these themes, so let's take a look.


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Danaher Corporation's Business Strategy

The market greeted industrial conglomerate Danaher's (NYSE: DHR  ) latest quarterly results with a nice pop on the day of the earnings release. This was the first set of company earnings presided over by new CEO Tom Joyce. Naturally, investors were keen to find out just what kind of message the new chief executive was looking to give out. His predecessor,Larry Culp, was closely associated with the company's success over the years, and Joyce has large boots to fill. So, in that context, we'll look at five key takeaways from the company's quarterly conference call. Is Joyce taking the company in the right direction?

Business as usual at Danaher?

In a previous article, Fools looked at the earnings in more detail. The company is known for acquiring businesses and then applying its Danaher Business System, or DBS, to them. Simply put, it's a management strategy that emphasizes lean manufacturing processes that can be applied across all segments of the company. While the current results will still be a product of Culp's management, the question is does Joyce plan to change its business strategy?

DBS Explained Source: Danaher Website

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Danaher Corporation Bullish Article

After an underwhelming set of second-quarter results and some cautious management guidance, investors in Danaher Corporation must have felt the stock was likely to be range-bound for a while. However, a good quality company is rarely without upside potential, and there are three key reasons for optimism over the stock, ranging from the near term to the long term -- suggesting that investors have a significant time frame in which to expect some upside.



Communications and dental consumables to bounce back?
Starting with the near term, Fools already know that Danaher's second-quarter results were adversely affected by the underperformance of two businesses with high variable margin. Communications-based revenue in the test and measurement segment was weak because of spending delays by wireless carriers, and dental consumables in the dental segment were weak, too. You can see the effect on profits and margins in this article.



Danaher's management candidly said that it doesn't expect conditions to get better anytime soon with communications, but the reality is that wireless carrier spending is notoriously lumpy.


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Danaher Corporation Conference Call Review

Investors in Danaher Corporation (NYSE: DHR  ) saw the company deliver a disappointing set of second-quarter results that caused the stock to drop notably. In fact, as of today, it's pretty much flat on a six-month basis. In truth, the results weren't that bad: The midpoint of full-year generally accepted accounting principles earnings per share guidance was actually raised by a couple cents as management narrowed its guidance to $3.67-$3.72 from $3.60-$3.75.



However, the market obviously expected more, and certain elements of the company's performance surprised on the downside. Danaher reports out of five segments: industrial technologies, environmental (mainly water quality), dental, life sciences and diagnostics, and test and measurement. This kind of diversification normally means that the company is broadly exposed to the industrial economy, and management's commentary certainly reflected a moderately growing environment. With that said, here are five things management wants you to know about the quarter.

Weakness limited to two areas, profits and margins hit

First, Danaher's management was keen to point out that the weakness was limited to two specific areas. Communications revenue within its test and measurement segment was down at a "low double-digit" rate, which the company linked to delays in spending by wireless carriers. Indeed, rival Agilent (NYSE: A  ) also reported a 6% fall in its communications revenue. The other difficult area came in the dental segment, which recorded "weak consumable sales," possibly due to bad weather earlier in the year. Unfortunately, according to Danaher CEO Larry Culp, both products tend to be "high-margin variables", and their underperformance hit operating profits within the test and measurement and dental segments.

Source: Danaher Presentations

Second, the impact...


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