Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Danaher Corp., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Operating Cash Flow Trends
- The net cash provided by operating activities increased significantly from 2020 to 2022, rising from $6,215 million to $8,519 million. This upward trend indicates a strengthening in core operational cash generation during the first three years. However, a decline was observed in 2023, with operating cash flow decreasing to $6,490 million, followed by a slight recovery to $6,688 million in 2024. Despite this partial rebound, the cash flow in 2024 remained below the peak levels seen in 2021 and 2022.
- Free Cash Flow to Equity Trends
- Free cash flow to equity exhibited pronounced volatility over the five-year period. Starting at $3,500 million in 2020, there was a marked surge to $9,044 million in 2021, reflecting a substantial increase in cash available to equity shareholders. However, this was followed by a sharp decrease to $5,688 million in 2022, and a further reduction to approximately $3,493 million in 2023. A slight increase to $3,640 million occurred in 2024, but the levels remained close to those seen at the beginning of the period, indicating considerable fluctuations and potential challenges in maintaining consistent free cash flow.
- Comparative Analysis
- The trends of operating cash flow and free cash flow to equity show different patterns in terms of variability. While operating cash flow experienced growth followed by a correction and a partial recovery, free cash flow to equity demonstrated more significant fluctuations, especially with the peak in 2021 and substantial declines thereafter. This divergence may suggest variations in capital expenditures, financing activities, or other uses of cash that impact free cash flow differently than operating cash generation.
- Overall Insights
- The data indicates periods of strong operational cash generation and free cash flow to equity, particularly in 2021. However, the subsequent periods show a cooling off and decreased cash availability to shareholders. This pattern may warrant further investigation into the underlying causes such as changes in investment strategy, capital expenditures, or external factors affecting cash flow stability. Sustaining and stabilizing free cash flow alongside solid operational cash generation appears to be a key focus area moving forward.
Price to FCFE Ratio, Current
Danaher Corp., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 715,669,594 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | 3,640) |
| FCFE per share | 5.09 |
| Current share price (P) | 200.96 |
| Valuation Ratio | |
| P/FCFE | 39.51 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| AbbVie Inc. | 13.42 |
| Amgen Inc. | 25.99 |
| Bristol-Myers Squibb Co. | 4.03 |
| Eli Lilly & Co. | 58.90 |
| Gilead Sciences Inc. | 11.94 |
| Johnson & Johnson | 12.58 |
| Merck & Co. Inc. | 10.30 |
| Pfizer Inc. | 54.30 |
| Regeneron Pharmaceuticals Inc. | 16.19 |
| Thermo Fisher Scientific Inc. | 32.21 |
| Vertex Pharmaceuticals Inc. | — |
| P/FCFE, Sector | |
| Pharmaceuticals, Biotechnology & Life Sciences | 18.71 |
| P/FCFE, Industry | |
| Health Care | 17.06 |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Danaher Corp., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 714,709,852 | 739,701,725 | 728,576,886 | 715,352,586 | 712,204,198 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | 3,640) | 3,493) | 5,688) | 9,044) | 3,500) | |
| FCFE per share3 | 5.09 | 4.72 | 7.81 | 12.64 | 4.91 | |
| Share price1, 4 | 207.95 | 250.65 | 250.11 | 262.39 | 219.26 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 40.83 | 53.08 | 32.04 | 20.75 | 44.62 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| AbbVie Inc. | 13.57 | 17.37 | 22.66 | 18.76 | 13.16 | |
| Amgen Inc. | 25.50 | 4.71 | 8.32 | 13.52 | 11.06 | |
| Bristol-Myers Squibb Co. | 4.74 | 7.52 | 22.85 | 16.17 | 7.80 | |
| Eli Lilly & Co. | 64.93 | 75.06 | 60.51 | 35.17 | 36.62 | |
| Gilead Sciences Inc. | 12.07 | 12.81 | 15.22 | 12.70 | 5.98 | |
| Johnson & Johnson | 12.67 | 24.31 | 16.73 | 23.28 | 15.60 | |
| Merck & Co. Inc. | 11.32 | 24.48 | 22.40 | 18.72 | 17.85 | |
| Pfizer Inc. | 55.28 | 3.82 | 10.56 | 8.88 | — | |
| Regeneron Pharmaceuticals Inc. | 21.27 | 26.52 | 19.29 | 10.35 | 13.30 | |
| Thermo Fisher Scientific Inc. | 41.23 | 31.16 | 27.98 | 13.44 | 18.58 | |
| Vertex Pharmaceuticals Inc. | — | 33.45 | 19.91 | 26.08 | 18.46 | |
| P/FCFE, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | 19.99 | 16.91 | 19.28 | 16.49 | 17.09 | |
| P/FCFE, Industry | ||||||
| Health Care | 18.69 | 17.15 | 18.11 | 18.05 | 17.25 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 3,640,000,000 ÷ 714,709,852 = 5.09
4 Closing price as at the filing date of Danaher Corp. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= 207.95 ÷ 5.09 = 40.83
6 Click competitor name to see calculations.
- Share Price Trend
- The share price experienced an overall increase from 219.26 US$ in 2020 to a peak of 262.39 US$ in 2021. Following this, there was a decline to 250.11 US$ in 2022, a slight stabilization at 250.65 US$ in 2023, and a more notable decrease to 207.95 US$ in 2024. This indicates a period of volatility with a downward trend in the last two years.
- FCFE per Share Trend
- Free Cash Flow to Equity (FCFE) per share showed significant variability. It increased sharply from 4.91 US$ in 2020 to 12.64 US$ in 2021, then decreased steadily over the next two years to 7.81 US$ in 2022 and further to 4.72 US$ in 2023. In 2024, there was a moderate recovery to 5.09 US$. This suggests fluctuations in cash flow generation available to equity shareholders, with a peak in 2021 followed by a decline and partial rebound.
- P/FCFE Ratio Analysis
- The Price to FCFE ratio exhibited a highly variable pattern. Starting at 44.62 in 2020, it decreased significantly to 20.75 in 2021, suggesting an improvement in valuation relative to FCFE. However, it increased again to 32.04 in 2022 and sharply to 53.08 in 2023, before falling to 40.83 in 2024. This volatility reflects changing market perceptions of cash flow value, with the highest valuation seen in 2023 followed by a decrease.
- Summary of Financial Insights
- Overall, the data indicates that the company’s market valuation and cash flow metrics have experienced notable fluctuations over the five-year period. The peak FCFE per share in 2021 corresponds with an increase in share price, but subsequent declines in FCFE and share price suggest challenges in maintaining cash flow growth. The P/FCFE ratio volatility indicates shifts in investor sentiment and valuation multiples, with elevated ratios implying that the market at times valued the company at a premium relative to its free cash flow. The recent downward trend in share price coupled with a moderate FCFE recovery and a declining P/FCFE ratio in 2024 may suggest a more cautious investor outlook or adjustment to a new valuation baseline.