Danaher (DHR) Stock Slides on $10B Masimo Buyout Announcement

Danaher Corporation (NYSE: DHR) shares fell sharply on Tuesday, February 17, 2026, after the healthcare and diagnostics giant announced a definitive agreement to acquire Masimo Corporation in an all-cash deal valued at approximately $9.9 billion. The acquisition, priced at $180 per share, represents a nearly 40% premium to Masimo’s closing price of $130.15 on Friday.

While the deal marks a significant strategic expansion for Danaher into patient monitoring technology, investors responded cautiously, sending DHR shares down more than 3% in morning trading. The move adds Masimo’s industry-leading pulse oximetry and patient monitoring portfolio to Danaher’s growing diagnostics segment, but the hefty price tag has raised questions about near-term financial impact.

What Danaher Is Gaining From the Masimo Deal

Danaher has entered into a definitive agreement to acquire Masimo Corporation, a California-based global med-tech company specializing in noninvasive patient monitoring solutions including pulse oximeters, sensors, and related software primarily used in acute care settings. The $180-per-share all-cash offer values Masimo at approximately $9.9 billion, a figure Danaher says is reasonable at 18 times Masimo’s estimated 2027 EBITDA, given Masimo’s track record of meeting financial targets.

Danaher plans to fund the acquisition through a combination of cash on hand and debt financing, leveraging its robust balance sheet which holds $4.62 billion in total cash as of its most recent quarter.

Once the deal closes, Masimo is expected to operate as a standalone company within Danaher’s Diagnostics segment, alongside existing businesses such as Radiometer, Leica Biosystems, Cepheid, and Beckman Coulter Diagnostics.

This structure reflects Danaher’s well-established acquisition playbook, which has driven the company’s growth strategy over the past 25 years through disciplined bolt-on and transformative deals. Masimo’s management had previously projected 7%–10% revenue CAGR through 2028 with operating margins approaching 30%, making it an attractive long-term asset within Danaher’s portfolio.

Masimo itself has undergone significant transformation ahead of this deal. Activist hedge fund Politan Capital Management, which holds close to 9% of Masimo, ran successful proxy fights in 2023 and 2024, ultimately removing founder Joe Kiani as board chair and overhauling the company’s strategic direction.

Masimo also divested its Sound United speaker business to Harman International for roughly $350 million in 2025, unwinding a widely criticized acquisition that had weighed heavily on the stock and refocusing the company on its core healthcare business.

Join our Telegram group and never miss a breaking digital asset story.

Danaher Stock Update: Market Reaction to the Deal

As of approximately 10:25 AM EST on February 17, 2026, Danaher shares were trading at $205.35, down $7.23 or 3.40% from the previous close of $212.58, with the stock opening as low as $201.80 and trading in an intraday range of $201.00 to $208.50.

Volume stood at roughly 1.4 million shares, well below the average daily volume of 3.7 million, suggesting the selloff was concentrated rather than broadly driven. Yahoo Finance cited insider share disposals as an additional headwind compounding investor unease around the acquisition announcement, with Simply Wall St. flagging possible bearish signals from recent insider activity.

From a performance standpoint, DHR has significantly underperformed the broader market across multiple timeframes. Year-to-date, the stock is down 9.85% compared to the S&P 500’s modest decline of 0.40%, and over the past three and five years, DHR has returned -7.79% and -0.82% respectively, while the S&P 500 has surged 67.15% and 73.44% over the same periods.

The stock’s 52-week range of $171.00 to $242.80 reflects the volatility the name has experienced since its post-pandemic peak, having fallen roughly 28% from its September 2021 high. Despite these headwinds, the company beat earnings estimates in all four quarters of fiscal year 2025, most recently reporting Q4 EPS of $2.23 against an estimate of $2.19, with quarterly revenue of $6.84 billion.

Analyst sentiment on DHR remains broadly constructive, with the consensus 1-year price target sitting at $264.91, representing significant upside from current levels. JP Morgan most recently maintained its Overweight rating in late January 2026, raising its price target from $270 to $275.

With a forward P/E of 25.19 and the company guiding for fiscal 2026 adjusted EPS of $8.35–$8.50, Danaher’s valuation looks more reasonable on a forward basis, though the market’s initial reaction to the Masimo deal suggests investors will be watching closely for clarity on integration costs, leverage, and the long-term strategic rationale in the quarters ahead.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.