Danaher Corporation (NYSE: DHR) and Bruker Corporation (NASDAQ:BRKR) are both mid-cap multi-sector conglomerates companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Dividends

Danaher Corporation pays an annual dividend of $0.56 per share and has a dividend yield of 0.6%. Bruker Corporation pays an annual dividend of $0.16 per share and has a dividend yield of 0.5%. Danaher Corporation pays out 17.8% of its earnings in the form of a dividend. Bruker Corporation pays out 16.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Bruker Corporation has increased its dividend for 3 consecutive years.

Profitability

This table compares Danaher Corporation and Bruker Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Danaher Corporation 12.63% 11.15% 5.95%
Bruker Corporation 9.65% 26.66% 10.47%

Valuation and Earnings

This table compares Danaher Corporation and Bruker Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Danaher Corporation $17.43 billion 3.46 $4.16 billion $3.14 27.64
Bruker Corporation $1.66 billion 2.81 $275.00 million $1.00 29.36

Danaher Corporation has higher revenue and earnings than Bruker Corporation. Danaher Corporation is trading at a lower price-to-earnings ratio than Bruker Corporation, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Danaher Corporation has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500. Comparatively, Bruker Corporation has a beta of 1.1, suggesting that its stock price is 10% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Danaher Corporation and Bruker Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Danaher Corporation 0 3 11 0 2.79
Bruker Corporation 1 8 3 0 2.17

Danaher Corporation currently has a consensus target price of $92.75, suggesting a potential upside of 6.88%. Bruker Corporation has a consensus target price of $26.25, suggesting a potential downside of 10.59%. Given Danaher Corporation’s stronger consensus rating and higher possible upside, equities analysts plainly believe Danaher Corporation is more favorable than Bruker Corporation.

Insider and Institutional Ownership

75.7% of Danaher Corporation shares are held by institutional investors. Comparatively, 65.4% of Bruker Corporation shares are held by institutional investors. 12.2% of Danaher Corporation shares are held by insiders. Comparatively, 35.2% of Bruker Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Danaher Corporation beats Bruker Corporation on 10 of the 17 factors compared between the two stocks.

Danaher Corporation Company Profile

Danaher Corporation (Danaher) designs, manufactures and markets professional, medical, industrial and commercial products and services. The Company operates through four segments: Life Sciences, which offers a range of research tools that scientists use to study the basic building blocks of life, including genes, proteins, metabolites and cells, in order to understand the causes of disease, identify new therapies and test new drugs and vaccines; Diagnostics; which offers analytical instruments, reagents, consumables, software and services; Dental, which provides products that are used to diagnose, treat and prevent disease and ailments of the teeth, gums and supporting bone, and Environmental & Applied Solutions, which consists of various lines of business, including water quality and product identification. As of December 31, 2016, Danaher’s research and development, manufacturing, sales, distribution, service and administrative facilities were located in over 60 countries.

Bruker Corporation Company Profile

Bruker Corporation designs and manufactures scientific instruments, and analytical and diagnostic solutions. Its segments include the Bruker BioSpin Group; the Bruker Chemicals, Applied Markets, Life Science, In-Vitro Diagnostics, Detection (CALID) Group; the Bruker Nano Group, and the Bruker Energy & Supercon Technologies (BEST) Segment. The Bruker BioSpin Group segment designs, manufactures and distributes enabling life science tools. The Bruker CALID segment designs, manufactures and distributes life science mass spectrometry instruments that can be integrated and used along with other sample preparation or chromatography instruments, as well as chemical, biological, radiological, nuclear and explosive detection products. The Bruker Nano segment designs, manufactures and distributes spectroscopy and microscopy instruments. The BEST segment develops and manufactures superconducting and non-superconducting materials and devices. It also focuses on nanomechanical testing instruments.

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