Intrinsic value of Danaher Corporation - DHR

Previous Close

$139.63

  Intrinsic Value

$92.61

stock screener

  Rating & Target

sell

-34%

Previous close

$139.63

 
Intrinsic value

$92.61

 
Up/down potential

-34%

 
Rating

sell

We calculate the intrinsic value of DHR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 99.7

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  5.50
  5.45
  5.40
  5.36
  5.33
  5.30
  5.27
  5.24
  5.22
  5.19
  5.17
  5.16
  5.14
  5.13
  5.11
  5.10
  5.09
  5.08
  5.08
  5.07
  5.06
  5.05
  5.05
  5.04
  5.04
  5.04
  5.03
  5.03
  5.03
  5.02
Revenue, $m
  20,987
  22,131
  23,327
  24,578
  25,888
  27,259
  28,694
  30,198
  31,772
  33,423
  35,152
  36,965
  38,865
  40,858
  42,947
  45,139
  47,438
  49,849
  52,379
  55,034
  57,819
  60,741
  63,808
  67,027
  70,405
  73,950
  77,672
  81,578
  85,678
  89,982
Variable operating expenses, $m
  15,240
  15,866
  16,520
  17,205
  17,921
  18,671
  19,456
  20,279
  21,140
  22,043
  19,231
  20,223
  21,263
  22,353
  23,496
  24,695
  25,953
  27,272
  28,656
  30,109
  31,632
  33,231
  34,909
  36,670
  38,518
  40,458
  42,494
  44,631
  46,874
  49,229
Fixed operating expenses, $m
  1,939
  1,981
  2,025
  2,070
  2,115
  2,162
  2,209
  2,258
  2,307
  2,358
  2,410
  2,463
  2,517
  2,573
  2,629
  2,687
  2,746
  2,807
  2,868
  2,931
  2,996
  3,062
  3,129
  3,198
  3,268
  3,340
  3,414
  3,489
  3,566
  3,644
Total operating expenses, $m
  17,179
  17,847
  18,545
  19,275
  20,036
  20,833
  21,665
  22,537
  23,447
  24,401
  21,641
  22,686
  23,780
  24,926
  26,125
  27,382
  28,699
  30,079
  31,524
  33,040
  34,628
  36,293
  38,038
  39,868
  41,786
  43,798
  45,908
  48,120
  50,440
  52,873
Operating income, $m
  3,809
  4,284
  4,782
  5,304
  5,852
  6,426
  7,029
  7,661
  8,325
  9,021
  13,510
  14,278
  15,085
  15,932
  16,822
  17,757
  18,739
  19,770
  20,854
  21,994
  23,190
  24,448
  25,770
  27,159
  28,618
  30,152
  31,764
  33,458
  35,238
  37,109
EBITDA, $m
  8,308
  8,824
  9,364
  9,931
  10,524
  11,147
  11,801
  12,486
  13,205
  13,960
  14,753
  15,585
  16,458
  17,376
  18,339
  19,352
  20,415
  21,532
  22,705
  23,938
  25,233
  26,594
  28,024
  29,527
  31,106
  32,765
  34,509
  36,341
  38,266
  40,289
Interest expense (income), $m
  212
  526
  584
  644
  708
  775
  844
  917
  994
  1,074
  1,158
  1,245
  1,337
  1,434
  1,535
  1,641
  1,752
  1,869
  1,991
  2,120
  2,254
  2,396
  2,544
  2,699
  2,863
  3,034
  3,214
  3,402
  3,600
  3,808
  4,026
Earnings before tax, $m
  3,283
  3,700
  4,138
  4,596
  5,077
  5,582
  6,111
  6,667
  7,251
  7,864
  12,265
  12,941
  13,651
  14,397
  15,181
  16,004
  16,870
  17,779
  18,735
  19,739
  20,795
  21,904
  23,071
  24,296
  25,585
  26,939
  28,362
  29,858
  31,430
  33,083
Tax expense, $m
  886
  999
  1,117
  1,241
  1,371
  1,507
  1,650
  1,800
  1,958
  2,123
  3,312
  3,494
  3,686
  3,887
  4,099
  4,321
  4,555
  4,800
  5,058
  5,330
  5,615
  5,914
  6,229
  6,560
  6,908
  7,273
  7,658
  8,062
  8,486
  8,932
Net income, $m
  2,396
  2,701
  3,020
  3,355
  3,706
  4,075
  4,461
  4,867
  5,293
  5,740
  8,954
  9,447
  9,965
  10,510
  11,082
  11,683
  12,315
  12,979
  13,676
  14,410
  15,180
  15,990
  16,841
  17,736
  18,677
  19,665
  20,704
  21,796
  22,944
  24,151

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  50,450
  53,199
  56,075
  59,083
  62,231
  65,526
  68,977
  72,590
  76,376
  80,343
  84,500
  88,858
  93,426
  98,216
  103,239
  108,507
  114,033
  119,830
  125,911
  132,292
  138,987
  146,013
  153,385
  161,122
  169,243
  177,765
  186,711
  196,101
  205,957
  216,304
Adjusted assets (=assets-cash), $m
  50,450
  53,199
  56,075
  59,083
  62,231
  65,526
  68,977
  72,590
  76,376
  80,343
  84,500
  88,858
  93,426
  98,216
  103,239
  108,507
  114,033
  119,830
  125,911
  132,292
  138,987
  146,013
  153,385
  161,122
  169,243
  177,765
  186,711
  196,101
  205,957
  216,304
Revenue / Adjusted assets
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
  0.416
Average production assets, $m
  22,246
  23,459
  24,727
  26,053
  27,441
  28,894
  30,416
  32,009
  33,679
  35,428
  37,261
  39,183
  41,197
  43,309
  45,524
  47,847
  50,284
  52,840
  55,522
  58,336
  61,288
  64,386
  67,637
  71,048
  74,629
  78,387
  82,332
  86,473
  90,819
  95,381
Working capital, $m
  1,595
  1,682
  1,773
  1,868
  1,967
  2,072
  2,181
  2,295
  2,415
  2,540
  2,672
  2,809
  2,954
  3,105
  3,264
  3,431
  3,605
  3,789
  3,981
  4,183
  4,394
  4,616
  4,849
  5,094
  5,351
  5,620
  5,903
  6,200
  6,512
  6,839
Total debt, $m
  10,807
  11,934
  13,113
  14,346
  15,637
  16,988
  18,403
  19,884
  21,436
  23,063
  24,767
  26,554
  28,427
  30,391
  32,450
  34,610
  36,876
  39,253
  41,746
  44,362
  47,107
  49,987
  53,010
  56,182
  59,512
  63,006
  66,674
  70,524
  74,565
  78,807
Total liabilities, $m
  20,684
  21,812
  22,991
  24,224
  25,515
  26,866
  28,280
  29,762
  31,314
  32,941
  34,645
  36,432
  38,305
  40,269
  42,328
  44,488
  46,754
  49,130
  51,624
  54,240
  56,985
  59,865
  62,888
  66,060
  69,389
  72,884
  76,552
  80,401
  84,443
  88,685
Total equity, $m
  29,765
  31,388
  33,084
  34,859
  36,716
  38,660
  40,696
  42,828
  45,062
  47,402
  49,855
  52,426
  55,121
  57,947
  60,911
  64,019
  67,280
  70,700
  74,288
  78,052
  82,002
  86,147
  90,497
  95,062
  99,853
  104,882
  110,160
  115,700
  121,515
  127,619
Total liabilities and equity, $m
  50,449
  53,200
  56,075
  59,083
  62,231
  65,526
  68,976
  72,590
  76,376
  80,343
  84,500
  88,858
  93,426
  98,216
  103,239
  108,507
  114,034
  119,830
  125,912
  132,292
  138,987
  146,012
  153,385
  161,122
  169,242
  177,766
  186,712
  196,101
  205,958
  216,304
Debt-to-equity ratio
  0.360
  0.380
  0.400
  0.410
  0.430
  0.440
  0.450
  0.460
  0.480
  0.490
  0.500
  0.510
  0.520
  0.520
  0.530
  0.540
  0.550
  0.560
  0.560
  0.570
  0.570
  0.580
  0.590
  0.590
  0.600
  0.600
  0.610
  0.610
  0.610
  0.620
Adjusted equity ratio
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590
  0.590

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,396
  2,701
  3,020
  3,355
  3,706
  4,075
  4,461
  4,867
  5,293
  5,740
  8,954
  9,447
  9,965
  10,510
  11,082
  11,683
  12,315
  12,979
  13,676
  14,410
  15,180
  15,990
  16,841
  17,736
  18,677
  19,665
  20,704
  21,796
  22,944
  24,151
Depreciation, amort., depletion, $m
  4,499
  4,540
  4,582
  4,626
  4,673
  4,721
  4,772
  4,825
  4,881
  4,939
  1,242
  1,306
  1,373
  1,444
  1,517
  1,595
  1,676
  1,761
  1,851
  1,945
  2,043
  2,146
  2,255
  2,368
  2,488
  2,613
  2,744
  2,882
  3,027
  3,179
Funds from operations, $m
  6,896
  7,241
  7,603
  7,982
  8,379
  8,796
  9,233
  9,692
  10,174
  10,679
  10,196
  10,753
  11,339
  11,953
  12,599
  13,278
  13,991
  14,740
  15,527
  16,354
  17,223
  18,136
  19,096
  20,105
  21,164
  22,278
  23,449
  24,679
  25,971
  27,330
Change in working capital, $m
  83
  87
  91
  95
  100
  104
  109
  114
  120
  125
  131
  138
  144
  151
  159
  167
  175
  183
  192
  202
  212
  222
  233
  245
  257
  269
  283
  297
  312
  327
Cash from operations, $m
  6,813
  7,154
  7,512
  7,886
  8,279
  8,692
  9,124
  9,578
  10,054
  10,554
  10,064
  10,615
  11,194
  11,802
  12,441
  13,112
  13,816
  14,557
  15,335
  16,152
  17,012
  17,914
  18,863
  19,860
  20,908
  22,009
  23,166
  24,382
  25,660
  27,003
Maintenance CAPEX, $m
  -703
  -742
  -782
  -824
  -868
  -915
  -963
  -1,014
  -1,067
  -1,123
  -1,181
  -1,242
  -1,306
  -1,373
  -1,444
  -1,517
  -1,595
  -1,676
  -1,761
  -1,851
  -1,945
  -2,043
  -2,146
  -2,255
  -2,368
  -2,488
  -2,613
  -2,744
  -2,882
  -3,027
New CAPEX, $m
  -1,167
  -1,212
  -1,268
  -1,326
  -1,388
  -1,453
  -1,521
  -1,594
  -1,669
  -1,749
  -1,833
  -1,922
  -2,014
  -2,112
  -2,215
  -2,323
  -2,437
  -2,556
  -2,682
  -2,814
  -2,952
  -3,098
  -3,251
  -3,412
  -3,581
  -3,758
  -3,945
  -4,141
  -4,346
  -4,562
Cash from investing activities, $m
  -1,870
  -1,954
  -2,050
  -2,150
  -2,256
  -2,368
  -2,484
  -2,608
  -2,736
  -2,872
  -3,014
  -3,164
  -3,320
  -3,485
  -3,659
  -3,840
  -4,032
  -4,232
  -4,443
  -4,665
  -4,897
  -5,141
  -5,397
  -5,667
  -5,949
  -6,246
  -6,558
  -6,885
  -7,228
  -7,589
Free cash flow, $m
  4,943
  5,200
  5,462
  5,736
  6,023
  6,324
  6,639
  6,970
  7,318
  7,682
  7,050
  7,452
  7,874
  8,317
  8,782
  9,271
  9,785
  10,325
  10,892
  11,488
  12,115
  12,773
  13,466
  14,194
  14,959
  15,763
  16,608
  17,497
  18,431
  19,413
Issuance/(repayment) of debt, $m
  1,066
  1,127
  1,179
  1,233
  1,291
  1,351
  1,415
  1,482
  1,552
  1,626
  1,704
  1,787
  1,873
  1,964
  2,059
  2,160
  2,266
  2,377
  2,493
  2,616
  2,745
  2,880
  3,023
  3,172
  3,329
  3,494
  3,668
  3,850
  4,041
  4,242
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  1,066
  1,127
  1,179
  1,233
  1,291
  1,351
  1,415
  1,482
  1,552
  1,626
  1,704
  1,787
  1,873
  1,964
  2,059
  2,160
  2,266
  2,377
  2,493
  2,616
  2,745
  2,880
  3,023
  3,172
  3,329
  3,494
  3,668
  3,850
  4,041
  4,242
Total cash flow (excl. dividends), $m
  6,009
  6,328
  6,641
  6,969
  7,314
  7,675
  8,054
  8,452
  8,870
  9,308
  8,754
  9,238
  9,747
  10,281
  10,841
  11,431
  12,050
  12,701
  13,385
  14,104
  14,860
  15,654
  16,489
  17,366
  18,288
  19,257
  20,276
  21,347
  22,472
  23,655
Retained Cash Flow (-), $m
  -1,551
  -1,622
  -1,696
  -1,775
  -1,857
  -1,944
  -2,036
  -2,132
  -2,234
  -2,340
  -2,453
  -2,571
  -2,695
  -2,826
  -2,964
  -3,108
  -3,260
  -3,420
  -3,588
  -3,765
  -3,950
  -4,145
  -4,350
  -4,565
  -4,791
  -5,028
  -5,278
  -5,540
  -5,815
  -6,104
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  4,458
  4,705
  4,944
  5,194
  5,456
  5,731
  6,018
  6,320
  6,636
  6,968
  6,302
  6,667
  7,051
  7,454
  7,878
  8,323
  8,790
  9,281
  9,797
  10,340
  10,910
  11,509
  12,139
  12,801
  13,497
  14,229
  14,998
  15,807
  16,657
  17,551
Discount rate, %
  4.50
  4.73
  4.96
  5.21
  5.47
  5.74
  6.03
  6.33
  6.65
  6.98
  7.33
  7.70
  8.08
  8.49
  8.91
  9.36
  9.82
  10.31
  10.83
  11.37
  11.94
  12.54
  13.16
  13.82
  14.51
  15.24
  16.00
  16.80
  17.64
  18.52
PV of cash for distribution, $m
  4,266
  4,290
  4,276
  4,239
  4,181
  4,099
  3,994
  3,867
  3,718
  3,549
  2,894
  2,739
  2,567
  2,383
  2,190
  1,990
  1,787
  1,586
  1,389
  1,200
  1,021
  856
  706
  573
  456
  356
  273
  204
  150
  107
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

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.

FINANCIAL RATIOS  of  Danaher Corporation (DHR)

Valuation Ratios
P/E Ratio 37.8
Price to Sales 5.7
Price to Book 4.2
Price to Tangible Book
Price to Cash Flow 27.4
Price to Free Cash Flow 33
Growth Rates
Sales Growth Rate 17%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 15%
Cap. Spend. - 3 Yr. Gr. Rate 1.9%
Financial Strength
Quick Ratio 0
Current Ratio 0
LT Debt to Equity 42.1%
Total Debt to Equity 53.3%
Interest Coverage 13
Management Effectiveness
Return On Assets 5.8%
Ret/ On Assets - 3 Yr. Avg. 7.2%
Return On Total Capital 7.1%
Ret/ On T. Cap. - 3 Yr. Avg. 9.2%
Return On Equity 10.9%
Return On Equity - 3 Yr. Avg. 12.2%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 55.4%
Gross Margin - 3 Yr. Avg. 54.3%
EBITDA Margin 23.4%
EBITDA Margin - 3 Yr. Avg. 22.4%
Operating Margin 15.2%
Oper. Margin - 3 Yr. Avg. 15.4%
Pre-Tax Margin 15.5%
Pre-Tax Margin - 3 Yr. Avg. 15.3%
Net Profit Margin 15.1%
Net Profit Margin - 3 Yr. Avg. 19.5%
Effective Tax Rate 17.5%
Eff/ Tax Rate - 3 Yr. Avg. 17.8%
Payout Ratio 15.7%

DHR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the DHR stock intrinsic value calculation we used $19893 million for the last fiscal year's total revenue generated by Danaher Corporation. The default revenue input number comes from 0001 income statement of Danaher Corporation. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our DHR stock valuation model: a) initial revenue growth rate of 5.5% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.5%, whose default value for DHR is calculated based on our internal credit rating of Danaher Corporation, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Danaher Corporation.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of DHR stock the variable cost ratio is equal to 73.6%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $1897 million in the base year in the intrinsic value calculation for DHR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Danaher Corporation.

Corporate tax rate of 27% is the nominal tax rate for Danaher Corporation. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the DHR stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for DHR are equal to 106%.

Life of production assets of 30.3 years is the average useful life of capital assets used in Danaher Corporation operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for DHR is equal to 7.6%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $28214.4 million for Danaher Corporation - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 713.964 million for Danaher Corporation is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Danaher Corporation at the current share price and the inputted number of shares is $99.7 billion.

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