Danaher Gains From Business Strength Amid Persisting Headwinds

Danaher Corporation DHR has been witnessing solid momentum in its bioprocessing business, driven by an increase in demand for consumables from large pharmaceutical customers in Europe. In the second quarter of 2025, orders in the bioprocessing business increased for the eighth consecutive quarter. For 2025, Danaher anticipates core revenues from the bioprocessing business to increase in high single digits on a year-over-year basis.

Also, solid demand from pharmaceutical customers for monoclonal antibodies (mAbs) has been buoying the Biotechnology segment. In the second quarter, core revenues from this segment increased 6% year over year.

Recovery in the molecular diagnostics business, driven by an increase in demand for non-respiratory disease tests, has been supporting the performance of the Diagnostics segment. Solid momentum in the clinical diagnostics businesses, led by growth in the Beckman Colter Diagnostics unit, has been buoying the segment as well. The segment’s core revenues increased 2% on a year-over-year basis in the second quarter.

The company remains focused on acquiring businesses to gain access to new customers, regions and product lines. DHR’s acquisition of Abcam in December 2023 expanded its Life Sciences segment. Abcam's long track record of innovation, outstanding product quality and breadth of antibody portfolio boosted Danaher’s healthcare product portfolio. Acquisitions boosted the Life Sciences segment’s revenues by 1.5% in second-quarter 2025.

Danaher remains committed to rewarding shareholders through dividend payouts and share buybacks. For instance, it paid out dividends worth $423 million and $768 million in the first half of 2025 and 2024, respectively. Also, in February 2025, the company hiked its dividend by 18.5% to 32 cents per share.

DHR’s Price Performance

In the past three months, this Zacks Rank #3 (Hold) company has gained 7.2% compared with the industry’s 3.8% growth.

Despite the positives, lower demand across academic and government end markets has been weighing on Danaher’s protein consumables, flow cytometry and lab automation solutions businesses under the Life Sciences segment. The company has been witnessing a sales decline in the filtration business due to soft demand in the energy-related end market. Core revenues from the Life Sciences segment declined 2.5% on a year-over-year basis in the second quarter.

High debt levels have also been a concern for Danaher. It exited second-quarter 2025 with a long-term debt of $16.9 billion, up 5.6% sequentially. Its current liabilities were $6.8 billion, higher than the cash equivalents of about $3 billion. Also, interest expenses in the second quarter remained high at $71 million.

Key Picks

Some better-ranked stocks from the same space are discussed below:

Pediatrix Medical Group, Inc. MD presently sports a Zacks Rank # 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Pediatrix Medical delivered a trailing four-quarter average earnings surprise of 28.7%. In the past 60 days, the Zacks Consensus Estimate for MD’s 2025 earnings has increased 9.3%.

Charles River Laboratories International CRL currently carries a Zacks Rank #2 (Buy). CRL delivered a trailing four-quarter average earnings surprise of 12.8%.

In the past 60 days, the consensus estimate for Charles River’s 2025 earnings has increased 5.1%.

CVS Health CVS presently carries a Zacks Rank of 2. CVS Health delivered a trailing four-quarter average earnings surprise of 22.6%.

In the past 60 days, the Zacks Consensus Estimate for CVS’ 2025 earnings has increased 3.3%.

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