Initiating Coverage of Veralto With $95 Fair Value Estimate and Wide Moat Rating

Veralto was spun off from Danaher in 2023. The business is organized into two segments: water quality (60% of 2024 revenue) and product quality and innovation (40% of 2024 revenue). In both segments, Veralto offers a wide range of differentiated solutions, many of which are sold under a razor-and-blade business model, resulting in roughly 61% recurring revenue.