Science, health care and technology conglomerate Danaher Corp. (NYSE: DHR – $79.88) posted a profit of $391.6 million in the third quarter, down from $1.4 billion a year earlier. The previous year period includes earnings from the spun-off Fortive operations. Excluding certain items, earnings on a per-share basis rose to $0.87 from $0.71 a year ago. Revenue climbed 18% to $4.13 billion. Revenue excluding acquisitions increased 3%. Analysts had expected $4.13 billion in revenue and adjusted earnings per share of $0.82. In addition to the Cepheid acquisition announced last month, Danaher wasted no time in acquiring privately-held chromatography supplies maker Phenomenex for an undisclosed amount.
The company now anticipates adjusted earnings of $3.57 to $3.61 a share, up from its previous forecast of $3.53 to $ 3.60. Analysts had forecast per-share earnings of $3.56. Following the industrial technology and instrumentation spin-off, management announced that the dividend payout will be adjusted to $0.125 per share starting in the December quarter. Danaher is a growth-via-acquisition play, and any income generated should be viewed as a bonus. That said, much of the company’s available cash will always be earmarked for future shopping sprees. Longer-term-minded investors have a worthwhile play for total return based on the combination of appreciation potential and some degree of income displayed by these shares.