Sou Hu Cai Jing·2025-10-09 18:17Core Insights - Danaher Corporation has demonstrated consistent growth over 30 years, with gross and net profit margins doubling, and a compound annual growth rate of shareholder returns reaching 22% [2] - The company has completed over 400 acquisitions, investing approximately $90 billion, with an internal net return rate of about 21% [6][12] - Danaher emphasizes a disciplined and rational approach to mergers and acquisitions, avoiding overpaying for high-quality targets and not purchasing low-quality assets simply due to low valuations [12] Financial Performance - Key financial metrics from 1991 to 2024 show significant growth in enterprise value to revenue ratio, increasing from 1.8 to 7.5, and enterprise value multiples rising from 11.5 to 22.4 [1] - The price-to-earnings ratio has also increased from 26.5 to 36.8, while gross margins improved from 32% to 60% [1] Management and Strategy - Danaher’s management approach, known as the Danaher Business System (DBS), focuses on deep operational involvement in acquired companies, which is more effective than traditional consulting services [8] - The company’s strategy includes a focus on technology-driven acquisitions, particularly in strategic areas like automation and robotics [18] Comparison with Other Companies - Danaher is compared favorably against diversified groups like General Electric and Honeywell, as well as Berkshire Hathaway, in terms of operational performance and shareholder returns [2][4] - The investment strategies of companies like Midea and Tencent are noted to be more aligned with Danaher’s approach, focusing on synergistic acquisitions rather than mere scale expansion [17] Leadership and Influence - Danaher has produced notable leaders in the industry, with executives from Danaher taking key positions in companies like Wuxi Biologics and Wantai Biological Pharmacy [5][6] - Larry Culp, who led Danaher for 13 years, played a crucial role in rescuing General Electric, showcasing the influence of Danaher’s leadership style [5]