Danaher Corp. Earnings: Keeping the Profitability Streak Alive

Falling revenue did not prevent S&P 500 (NYSE:SPY) component Danaher Corporation (NYSE:DHR) from reporting a profit boost in the third quarter. Danaher designs and manufactures professional, medical, industrial, and consumer products.

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Danaher Corporation Earnings Cheat Sheet

Results: Net income for the diversified operations rose to $548.7 million (77 cents per share) vs. $523.4 million (74 cents per share) in the same quarter a year earlier. This marks a rise of 4.8% from the year-earlier quarter.

Revenue: Fell 2.3% to $4.42 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Danaher Corporation fell short of the mean analyst estimate of 79 cents per share. It fell short of the average revenue estimate of $4.58 billion.

Quoting Management: H. Lawrence Culp, Jr., President and Chief Executive Officer, stated, “Our team continued to execute well with solid margin expansion and cash flow performance in the quarter. Despite the macroeconomic pressures, we are successfully protecting our organic investments while remaining active on the acquisition front. We believe our strong recurring revenue base and efforts to reduce our structural costs, coupled with margin expansion opportunities present in our newer businesses position us well for the balance of 2012 and beyond.”

Key Stats:

A year-over-year revenue decrease last quarter breaks a four-quarter streak of revenue increases. The best quarter in that span was the third quarter of the last fiscal year, which saw revenue rise 41.6%.

After beating analyst estimates for the two previous quarters, the company fell short of forecasts. In the second quarter, it topped the mark by one cent, and in the first quarter, it was ahead by 3 cents.

Net income has increased 8.3% year-over-year on average across the last five quarters. The biggest gain came in the first quarter, when income climbed 42.8% from the year-earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 94 cents a share to 89 cents over the last thirty days. For the fiscal year, the average estimate has moved down from $3.32 a share to $3.23 over the last thirty days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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