There are trends you ignore and trends investors should not ignore. And one investors should not ignore is the bar code trend. Trend? It's becoming a world of bar codes.
And with the above in mind, I'm reiterating my Buy rating for Danaher Corp. (NYSE: DHR), first recommended on June 4, 2009, at a price of $62.95.
Among other devices, Danaher makes electronic and environmental testing products, including devices that read bar codes. Danaher is expected to report a FY2009 revenue decline, and yet Danaher's stock has managed to uptrend from $48 to about $66 in six months. That suggests institutional investors are anticipating a much better FY2010, if not an upside surprise for earnings this year.
Add productivity improvements, cost-cutting efforts, and a strong balance sheet and Danaher's stock still looks pretty cheap -- particularly given the near universal use of scanners in the economy of tomorrow. The First Call FY2009/FY2010 EPS estimates for DHR are $3.37 to $3.70.
Stock Analysis: Danaher Corp. is a moderate-risk stock. If you've already purchased the company's shares, hold them. If not, consider buying a 50% position in DHR now; then buy another 25% in three months, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 75% of your DHR position before October 2009. Sell/stop loss if you were to buy shares in this company: $32.
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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.


