April 27, 2025 a 11:31 am
DHR: Dividend Analysis - Danaher Corporation
Danaher Corporation showcases a steady yet modest dividend profile, making it a notable choice for investors seeking consistent income. With its near half-percent yield and a robust 33-year history of uninterrupted dividends, Danaher projects strong reliability without recent cuts. Coupled with a solid payout ratio, the company aligns with long-term dividend-focused strategies.
Overview
| Detail | Information |
|---|---|
| Sector | Life Sciences |
| Dividend Yield | 0.55% |
| Current Dividend Per Share | 1.05 USD |
| Dividend History | 33 years |
| Last Cut or Suspension | None |
Dividend History
Danaher's 33-year streak of unbroken dividend payments underscores its commitment to shareholders. Such a track record often represents a stable company with predictable cash flows, vital for income-focused investors.
| Year | Dividend Per Share (USD) |
|---|---|
| 2025 | 0.32 |
| 2024 | 1.08 |
| 2023 | 0.99 |
| 2022 | 0.89 |
| 2021 | 0.74 |
Dividend Growth
Observing Danaher's dividend growth over recent years highlights its capability to enhance shareholder returns. The incremental rises in both 3-year and 5-year growth rates reflect the company’s focus on rewarding its investors progressively.
| Time | Growth |
|---|---|
| 3 years | 13.19% |
| 5 years | 12.37% |
The average dividend growth is 12.37% over 5 years. This shows moderate but steady dividend growth.
Payout Ratio
A payout ratio provides insight into how much of a company’s earnings are distributed as dividends. Danaher reflects a conservative approach with an EPS-based payout ratio of 20% and an FCF ratio of 15%, indicating ample retained earnings for reinvestment.
| Ratio | Percentage |
|---|---|
| EPS-based | 20% |
| Free cash flow-based | 15% |
Cashflow & Capital Efficiency
Analyzing a company's cash flow and capital usage reveals its operational efficiency and investment capability. Danaher demonstrates a balanced approach with strong yields and capital reinvestment ratios, underpinning capital-intensive growth strategies.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Free Cash Flow Yield | 3.16% | 3.39% | 4.32% |
| Earnings Yield | 2.32% | 2.80% | 4.23% |
| CAPEX to Operating Cash Flow | 21.54% | 19.30% | 13.52% |
| Stock-based Compensation to Revenue | 1.21% | 1.28% | 0.94% |
| Free Cash Flow / Operating Cash Flow Ratio | 79.19% | 80.70% | 86.48% |
Balance Sheet & Leverage Analysis
The state of a company’s balance sheet indicates its financial flexibility and risk management ability. Danaher's prudent leverage and healthy ratios point to robust financial stewardship amidst operational demands.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Debt-to-Equity | 0.32 | 0.37 | 0.39 |
| Debt-to-Assets | 0.21 | 0.23 | 0.23 |
| Debt-to-Capital | 0.24 | 0.27 | 0.28 |
| Net Debt to EBITDA | 2.18 | 1.82 | 1.41 |
| Current Ratio | 1.43 | 1.68 | 1.89 |
| Quick Ratio | 1.05 | 1.37 | 1.52 |
| Financial Leverage | 1.57 | 1.58 | 1.68 |
Fundamental Strength & Profitability
Profitability metrics offer insights into operational efficiency and market competitiveness. Danaher showcases strong profitability margins paired with excellent ROE and ROA, indicating effective utilization of resources.
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Return on Equity | 7.87% | 8.91% | 14.39% |
| Return on Assets | 5.03% | 5.64% | 8.55% |
| Net Margin | 16.33% | 19.94% | 22.91% |
| EBIT Margin | 20.37% | 22.31% | 23.35% |
| EBITDA Margin | 20.37% | 31.39% | 30.86% |
| Gross Margin | 59.50% | 58.74% | 60.21% |
| Research & Development to Revenue | 6.70% | 6.29% | 5.54% |
Price Development
Dividend Scoring System
| Criteria | Description | Score |
|---|---|---|
| Dividend Yield | A modest yield contributing steady income. | |
| Dividend Stability | Reliability without disruptions. | |
| Dividend Growth | Steady increase over five years. | |
| Payout Ratio | Conservative and sustainable distribution. | |
| Financial Stability | Demonstrates strong balance sheet management. | |
| Dividend Continuity | Consistency with no recent interruptions. | |
| Cashflow Coverage | Solid cash reserves supporting payouts. | |
| Balance Sheet Quality | Robust financial health metrics. |
Overall Score: 69/80
Rating
Danaher Corporation earns a solid dividend reliability and growth potential score, thereby reinforcing its image as a stable long-term investment. Its low yield reflects its focus on reinvestment and growth rather than high payouts, suiting patient investors with a preference for steady portfolio expansion.