Yahoo Finance Can Danaher (DHR) Retain Beat Streak This Earnings Season?
Danaher Corporation DHR is scheduled to release first-quarter 2023 results on Apr 25, before market open.
The Zacks Consensus Estimate for Danaher’s first-quarter earnings has remained steady in the past 60 days. The company has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 13.1%.
Let’s see how things are shaping up for Danaher this earnings season.
Danaher Corporation Price and EPS Surprise
Danaher Corporation price-eps-surprise | Danaher Corporation Quote
Factors to Note
Danaher’s first-quarter performance is likely to have benefited from strength in the Life Sciences segment due to steady demand across end markets. Robust customer activity in bioprocessing is likely to have aided the Biotechnology segment.
Strength in Water Quality and Videojet businesses is likely to have boosted the growth of the Environmental & Applied Solutions segment. The Zacks Consensus Estimate for Environmental & Applied Solutions segment revenues in the first quarter indicates a 21.8% jump from the year-ago reported number.
Disciplined cost management, productivity initiatives and pricing actions are expected to have driven DHR’s margin performance in the to-be-reported quarter.
However, the escalating cost of sales due to raw material cost inflation is expected to have dented Danaher’s bottom line. We expect the company’s adjusted earnings (from continuing operations) to decline 18.8% year over year in the first quarter.
While the situation has improved, supply chain issues, primarily related to the shortage of components, continue to plague the company. This might have impacted DHR’s performance in the soon-to-be-reported quarter.
Given Danaher’s substantial international presence, foreign currency headwinds might have affected its top line. We expect the company’s revenues to decline around 9% in the to-be-reported quarter.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Danaher this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below.
Earnings ESP: Danaher has an Earnings ESP of -0.69% as the Most Accurate Estimate is pegged at $2.24, lower than the Zacks Consensus Estimate of $2.26. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: Danaher currently carries a Zacks Rank #2.
Highlights of Q4 Earnings
Danaher’s fourth-quarter 2022 adjusted earnings of $2.87 per share surpassed the Zacks Consensus Estimate of $2.46. The bottom line increased 6.7% from the year-ago quarter, primarily on sales growth. Net sales of $8,369 million outperformed the Zacks Consensus Estimate of $7,638 million and increased 2.7% year over year.
Stocks to Consider
Here are some companies, which according to our model, have the right combination of elements to beat on earnings in this reporting cycle.
A. O. Smith AOS has an Earnings ESP of +5.78% and a Zacks Rank #2. The company is scheduled to release first-quarter 2023 results on Apr 27. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for A. O. Smith’s first-quarter earnings has been revised upward by a penny in the past 60 days. The company pulled off a trailing four-quarter earnings surprise of 3.2%, on average.
Graco Inc. GGG has an Earnings ESP of +2.44% and a Zacks Rank #3. The company is slated to release first-quarter 2023 results on Apr 26.
The Zacks Consensus Estimate for Graco’s first-quarter earnings has remained steady in the past 60 days. The company delivered a trailing four-quarter earnings surprise of 0.2%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Danaher Corporation (DHR) : Free Stock Analysis Report
A. O. Smith Corporation (AOS) : Free Stock Analysis Report
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