Is Danaher Corporation (DHR) Fairly Valued?
Danaher Corporation valuation review using P/E, fair value, revenue growth, EPS growth, net margin, and TGMCharts chart exhibits as of July 10, 2026.
By TGMCharts Research · Data as of · Updated
Evaluating the investment profile of Danaher Corporation requires balancing its market price against underlying business execution. The stock is currently priced at 38.50x trailing earnings, which sits below the independent analyst DCF (FMP) benchmark of $218.
With a five-year revenue CAGR of 2.05% and a five-year EPS CAGR of 0.40%, the expansion rate of the business is modest relative to its multiple. However, the company maintains structural strength with a net margin of 14.89%, which helps defend its valuation premium.
- Danaher Corporation closed at $199 on July 10, 2026.
- Trailing P/E is 38.50x and price-to-sales is 5.71x.
- Analyst DCF (FMP) is $218 with margin of safety at 9.47%.
- Five-year revenue CAGR is 2.05% and five-year EPS CAGR is 0.40%.
- Earnings yield is 2.60% and net margin is 14.89%.
Valuation Setup
The market price, model anchor, growth support, and profitability facts behind the valuation read.
Evaluating the Premium Placed on Life Sciences Assets
Analyzing the market position of Danaher Corporation requires assessing whether its premium valuation is supported by fundamental business execution. At the close of trading on July 10, 2026, equity shares were priced at $199, translating to a trailing earnings multiple of 38.50x. This market pricing sits below the third-party analyst DCF (FMP) fair value estimate of $218, representing an implied margin of safety of 9.47%.
A comprehensive valuation assessment must look beyond any single ratio. By examining price-to-sales, earnings yield, historical revenue expansion, per-share profit trends, and margin durability as an integrated system, we can determine whether the current valuation is structurally sound or vulnerable to a downward adjustment.
Assessing Market Multiples Against Historical Baselines
Market participants are currently paying a sales multiple of 5.71x for the business, which corresponds to an earnings yield of 2.60%. This yield represents the cash-flow generation power available to owners relative to the prevailing capitalization. By comparing the trailing P/E history alongside the top-line multiple, we can observe how much of the current stock price is driven by multiple expansion versus underlying operational improvements.
DHR P/E ratio Chart
The trailing earnings multiple is the main valuation exhibit because it connects the market price to reported earnings.
Latest P/E ratio: 38.50x as of July 10, 2026.
A P/E ratio of 38.50x has to be judged against the company's five-year EPS CAGR of 0.40%. If the multiple is high while EPS support is ordinary, the valuation thesis becomes more dependent on investor confidence than on fresh earnings power.
DHR price-to-sales Chart
Price-to-sales gives a second valuation lens when margins and earnings can move around the cycle.
Latest price-to-sales ratio: 5.71x.
Price-to-sales at 5.71x is most useful beside net margin of 14.89%. A richer sales multiple is easier to defend when margin quality is durable rather than temporarily elevated.
Comparing Current Equity Value to DCF Benchmarks
The independent analyst DCF (FMP) model establishes a reference price of $218, placing the market price of $199 at a discount of 9.47%. While this discount suggests a positive margin of safety, investors should view this third-party calculation as one of many analytical inputs. It is crucial to review the broader scenario analysis on our dedicated valuation pages, as individual modeling assumptions regarding discount rates and terminal growth can lead to highly divergent outcomes.
The valuation at a glance
Each input on its own line: what the stock costs against earnings and sales, the model's fair value and how far price sits from it, and the growth and margins behind the business.
DHR earnings yield Chart
Earnings yield reframes valuation from an owner's-yield perspective rather than a multiple perspective.
Latest earnings yield: 2.60%.
The earnings yield of 2.60% is the counterweight to the P/E ratio. If the yield is thin relative to the quality and growth profile, the valuation case needs more help from future compounding.
Analyzing the Top and Bottom Line Growth Profile
Over the longer term, a high valuation multiple must be sustained by operational expansion. The company has delivered a five-year revenue CAGR of 2.05% alongside a five-year EPS CAGR of 0.40%. These modest annualized growth rates indicate that the premium multiple is carrying a significant portion of the valuation narrative, as business expansion has been relatively measured over this multi-year window.
DHR revenue
Revenue history tests whether the valuation is being supported by real business expansion.
Five-year revenue CAGR: 2.05%. This is endpoint-to-endpoint from the fiscal years shown — a depressed start year can inflate it, so read it against the recent bars.
Revenue growth is the business-expansion evidence behind the valuation read. A five-year revenue CAGR of 2.05% helps show how much of the valuation story is coming from company growth instead of only multiple expansion.
DHR EPS
EPS history checks whether reported earnings are keeping pace with the market multiple.
Five-year EPS CAGR: 0.40%. This is endpoint-to-endpoint from the fiscal years shown — a depressed or negative start year can inflate it, so read it against the recent bars.
A five-year EPS CAGR of 0.40% is the clearest support figure for a P/E-based conclusion. If EPS growth slows while the multiple remains elevated, the article should become more cautious after refresh.
Profitability Quality as a Valuation Safeguard
Operating efficiency serves as the bridge between top-line sales and bottom-line earnings power. With a net margin of 14.89% paired with a price-to-sales ratio of 5.71x, the firm demonstrates strong structural profitability. While high-quality margins help justify a higher sales multiple, they also leave less room for operational error or cost inflation, as any contraction in profitability would quickly pressure the trailing P/E ratio.
DHR net margin
Net margin shows whether the company has enough profitability quality to support its valuation.
Net margin (TTM): 14.89%. The bars below are annual fiscal years.
Net margin of 14.89% is a quality signal, not a valuation verdict by itself. It matters because a premium multiple is more defensible when margins are structurally strong and less defensible when margins are peaking.
The Core Tension in the Current Valuation Thesis
The positive valuation case is anchored by the company's robust net margin of 14.89% and the fact that the stock trades below the analyst DCF (FMP) reference of $218. Conversely, the negative case highlights that a P/E multiple of 38.50x is highly demanding when contrasted with a five-year EPS CAGR of only 0.40%, making the equity sensitive to any further deceleration in earnings.
Bull and bear case
Valuation support
- Five-year revenue CAGR of 2.05% and five-year EPS CAGR of 0.40% support the business case.
- Net margin of 14.89% is the quality check behind the multiple.
Valuation pressure
- A P/E ratio of 38.50x can become demanding if EPS growth slows.
- The analyst-DCF (FMP) margin of safety at 9.47% should change the valuation read if it deteriorates after refresh.
Key Operational Signposts for Reassessing the Read
Our analytical perspective would shift if the analyst DCF (FMP) fair value of $218 is revised downward, or if the market price closes the current gap, thereby erasing the implied 9.47% margin of safety. Furthermore, any structural deterioration in the five-year revenue CAGR of 2.05% or the net margin of 14.89% would undermine the fundamental support for the stock's premium multiples.
Synthesizing the Fundamental Evidence
In conclusion, the valuation of Danaher Corporation represents a balance between high-quality structural profitability and relatively slow historical growth. For the current valuation framework to remain constructive, the business must maintain its net margin of 14.89% while working to improve its long-term earnings trajectory. This research is based on verified financial filings and is intended for general informational purposes rather than personalized investment advice.
FAQ
Is DHR fairly valued?
Danaher Corporation trades at 38.50x trailing earnings with an analyst-DCF (FMP) margin of safety of 9.47%. The cleanest read comes from comparing that valuation to five-year revenue CAGR of 2.05% and five-year EPS CAGR of 0.40%.
What valuation metric matters most for DHR?
This article anchors on P/E, fair value, margin of safety, price-to-sales, earnings yield, revenue growth, and EPS growth. No single metric is treated as a recommendation.
How often should this DHR valuation view refresh?
We refresh this note after each daily market close, so the price, fair value, and every figure stay current. Numbers here are as of July 10, 2026.
What would change our mind
- A material move away from the analyst-DCF (FMP) reference of $218.
- A break in five-year EPS support, currently 0.40%.
- Margin quality drifting away from the latest net margin of 14.89%.
The bottom line
Danaher Corporation valuation research note from TGMCharts Research, grounded in precomputed fundamentals, chart exhibits, and a frozen claim ledger.
Read next: DHR fundamentalsContinue with Danaher Corporation's full stock page.How we checked this researchShowHide
Data snapshot · By TGMCharts Research.
Every number in this note comes from data we compute and store ourselves from the company's reported figures, plus verbatim excerpts from its SEC filings. When a value isn't available we say so — we never fill gaps with estimates.
Latest filing excerpt
10-Q · filed 2026-04-21 · period 2026-03-27 · SEC EDGAR source
- “Business Performance and Outlook During the first quarter of 2026, the Company's overall revenues and core sales increased 3.5% and 0.5%, respectively, compared to the comparable period of 2025.”
- “In the three-month period ended March 27, 2026, the impact of foreign currency increased reported sales by 3.0%.”
- “Geographically, the Company's sales in the three-month period ended March 27, 2026 in developed markets increased year-over-year by 3% and core sales in developed markets were down slightly as mid-single digit core sales decreases in North America were largely offset by a mid-single digit increase in Western Europe.”
- “For the same period, sales in high-growth markets increased year-over-year by 6% and core sales were up low-single digits driven primarily by a mid-single digit increase in core revenue in China.”
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