Danaher (DHR) TD Cowen 46th Annual Health Care Conference summary

Guidance and outlook

• Set guidance for 3%-6% growth in 2026, led by high single-digit growth in bioprocessing and improving life sciences end markets.

• Diagnostics expected to see low single-digit growth outside China, with China headwinds abating.

• Q1 seen as the low point, with improvement anticipated throughout the year, especially in life sciences and biotech as funding flows recover.

• High incremental margins (35%-40%) enable high single-digit EPS growth and 100 basis points of operating margin expansion, even at the low end of guidance.

• Further EPS expansion possible if growth exceeds the lower end of the range.

Masimo acquisition

• Masimo viewed as a specialty diagnostics leader with a strong IP moat and clinical data, fitting the long-term growth strategy.

• Acquisition expected to be accretive to growth, gross margin, and operating margin, targeting high single-digit ROIC by year 5.

• $125 million in cost synergies identified, split between cost of goods sold, operating expenses, and public company costs.

• $50 million in revenue synergies expected over five years, leveraging complementary strengths in Europe and the U.S.

Life sciences and bioprocessing

• Pharma end markets and biotech funding are stabilizing and improving, with modest growth expected.

• Academic and government funding has stabilized, with university funding improving.

• AI seen as a long-term accelerator for pharma development, increasing the number of drugs brought to market and benefiting bioprocessing.

• Bioprocessing consumables remain strong, with equipment showing sequential order growth and expected to improve further.

• Share gains noted in cell culture media and single-use technologies, with filtration seen as a major opportunity.