Patterson Companies (PDCO Quick QuotePDCO - Free Report) announced a partnership with the global leader in dental AI solutions, Pearl, which will provide it with new integrated AI solutions. As a part of the deal, Patterson Dental, a subsidiary of PDCO, will distribute Pearl’s Second Opinion and Practice Intelligence software solutions. Patterson Dental will also integrate Second Opinion’s AI pathology detection feature set within Patterson’s Eaglesoft dental practice management software.

PDCO believes that the integration of Pearl’s AI services will streamline operations, optimize efficiency and maximize profitability. The company expects to offer new solutions that transform practice performance by equipping users with dentistry’s most powerful AI-backed technology following the integration.

Second Opinion Advantage

Pearl’s Second Opinion received FDA approval last year for helping dentists detect numerous conditions commonly diagnosed in x-rays of adult teeth (patients aged 12 years and older). Second Opinion is the first FDA-approved dental AI software that has demonstrated 37% more accuracy in detecting pathology in patient x-rays.

The use of Second Opinion has led to 24% higher case acceptance for restorative, endodontic and periodontic treatments. Its use has also resulted in 71% greater patient trust in diagnoses.

Patterson Dental currently plans to integrate Pearl’s AI capabilities within the Eaglesoft practice management software. This integration will likely help in delivering dentistry’s most advanced clinical AI capabilities to Patterson Dental customers across the United States. PDCO is also focusing on integrating Pearl’s AI capabilities with its Fuse cloud-based practice management software and Dolphin practice management software.

Industry Prospects

Per a report by Knowledge Sourcing Intelligence, AI in the dental imaging industry is anticipated to reach $2084.18 million by 2028 (from $267.7 million in 2021), at a CAGR of approximately 34.1%. Factors like the rising adoption of AI-powered dental imaging technology to enhance patient care, treatment planning and diagnostic accuracy are expected to drive the market.

Given the market potential, the latest partnership is likely to provide a significant boost to Patterson Companies’ business.

Price Performance

Shares of PDCO have risen 15.2% year to date compared with the industry’s 7% growth. The S&P 500 has increased 19.4% in the said time frame.

Image Source: Zacks Investment Research

Zacks Rank & Other Stocks to Consider

Currently, Patterson Companies carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader medical space are DaVita Inc. (DVA Quick QuoteDVA - Free Report) , Biodesix (BDSX Quick QuoteBDSX - Free Report) and Integer Holdings Corporation (ITGR Quick QuoteITGR - Free Report) .

DaVita, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 18.3%. DVA’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 36.55%. You can see the complete list of today’s Zacks #1 Rank stocks here.

DaVita’s shares have risen 30.6% year to date compared with the industry’s 1.6% growth.

Biodesix, carrying a Zacks Rank of 2 at present, has an estimated growth rate of 32.3% for 2024. BDSX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 9.76%.

Biodesix’s shares have declined 36.5% year to date against the industry’s 12.6% decline.

Integer Holdings, sporting a Zacks Rank of 1 at present, has an estimated long-term growth rate of 15.8%. ITGR’s earnings surpassed estimates in each of the trailing four quarters, delivering an average surprise of 11.9%.

Integer Holdings’ shares have rallied 30.6% year to date against the industry’s 7.3% decline.