The upward wave in shares of Danaher since the life sciences company reported second-quarter earnings has left patient investors wondering whether the rally has staying power this time. Danaher has been a tough stock to own for the Club since we initiated a position in January 2022. Among the myriad headwinds have been the slow post-Covid economic recovery in China, customer over-ordering due to the pandemic supply chain crisis, fewer biotechs going public to spend on Danaher’s equipment, and President Donald Trump ‘s tariffs and cuts in National Institutes of Health spending. “Danaher always seems to be on the verge of getting better,” Jim Cramer said after last week’s better-than-expected quarter and full-year earnings guidance hike. Jim pointed out that Danaher has traditionally been well run and deserving of its more than 1,000% gain over 20 years. In recent years, however, it has lost its way. “I blame them because I don’t really care about their excuses. I want wins,” Jim added. Since a nearly five-year low close on April 8, before Trump’s “reciprocal” tariffs were paused, shares have made a few runs to the low $200s before retreating. But now, is the 10% post-earnings swing higher to nearly $207 over the past six completed sessions the start of something to get us back toward 2025 highs above $250 and beyond? RBC analyst Conor McNamara told CNBC the wait might be a little longer. “For the entire sector, including Danaher and Thermo and the rest of the life science tool names, we believe a sustained rally will come once the sector returns to mid single-digit [revenue] growth, which is still a quarter or two away.” Thermo Fisher Scientific shares have had a similar run after last week’s beat and raise. Shares of both Thermo and Danaher were down modestly Wednesday. In a note to RBC clients last week, McNamara said investors want to see “consistent beats and raises,” noting that Danaher’s earnings released on July 22 should bolster confidence. The analyst and his team have a buy rating on Danaher and a $250 per share price target. DHR YTD mountain Danaher YTD In addition to better-than-expected Q2 earnings per share and revenue, all three operating segments — biotechnology, life sciences, and diagnostics — beat estimates. In the biotech segment, bioprocessing showed continued improvement, adding to management’s confidence in a high single-digit, long-term growth outlook. Bioprocessing is the use of cell components to make a variety of products, including targeted therapies. Danaher is a leader in products and services that support health-care research and development. Danaher’s quarter, however, was far from perfect . China, which makes up 12% of company revenue, remains the biggest headwind. Sales in the world’s second-biggest economy in the second quarter declined mid-single digits on a percentage basis. CEO Rainer Blair said the company saw “growth in our biotechnology and life sciences businesses in China,” adding that stimulus-related funding translated into new customer orders and revenue. However, Blair did acknowledge Q2 declines in diagnostics, citing “volume-based procurement and reimbursement changes implemented in late 2024.” Volume-based procurement (VBP) is part of China’s national strategy to control health-care costs. He said, “There’s really no change to our expectations of $150 million adverse impact from volume-based procurement in 2025.” While raising their full-year EPS guidance, management left unchanged their outlook for adjusted core revenue growth of roughly 3%. McNamara thought that “upside from China stimulus money and improved pharma spend” should have translated into a stronger revenue guide. “There is still too much uncertainty to definitively call the bottom,” he added. The VBP issues were not called out in the RBC note. On the post-earnings call, Danaher CFO Matt McGrew said management didn’t boost its full-year revenue outlook because they didn’t want to assume some favorable first-half developments — specifically, better-than-anticipated performance in the respiratory business and foreign exchange benefits — would continue into year-end. Blair said the company’s ongoing cost-cutting plan has helped “offset cost pressures from tariffs.” We took those remarks to mean that guidance may very well prove conservative if the operating backdrop in the second half of the year holds. (Jim Cramer’s Charitable Trust is long DHR. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. 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