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Patterson Companies (PDCO) Q2 Earnings: What's in Store?
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Patterson Companies, Inc.’s (PDCO - Free Report) second-quarter fiscal 2018 results, scheduled for release on Nov 21, are expected to show steady growth in the Dental Supply segment — one of its major revenue components. While this could majorly drive second-quarter earnings, an expected improvement in revenues at all other segments should help the company generate solid results this season.
It is important to note that Patterson Companies’ last quarter earnings beat the Zacks Consensus Estimate by 2.3%. Similar to the prior quarter, strong growth in the Animal Health segment and consumable and printed products are expected to be the main factors driving second-quarter revenues.
The Zacks Consensus Estimate for the Dental Supply segment stands at $573 million for the second quarter. This reflects an increase of almost 10.4% from the last reported quarter. Meanwhile, the Zacks Consensus Estimate for operating income from the Animal Health unit is pegged at $22.9 million, up 37.4% from the preceding quarter.
Delving deeper into the fundamentals of the stock, let’s see how things are shaping up prior to this release.
Major Factors to Influence Q2
View Tepid
Management at Patterson Companies anticipates headwinds in its technology equipment business to persist through fiscal 2018. This is primarily because of Patterson Companies’ initiatives to transit its sales model to have an expanded technology product portfolio. In fact, the Zacks Consensus Estimate for earnings stands at 54 cents per share, down 4.2% year over year. Meanwhile, the Zacks Consensus Estimate for revenues is currently pegged at $1.42 billion, signifying 0.1% growth on a year-over-year basis.
Dental Unit
Patterson Companies have been investing in new digital technologies in its dental portfolio. Management expects these initiatives to drive sales in the second half of this fiscal. Further, the segment is expected to see solid margins in the second quarter. Patterson Companies is expected advantage from the gradual recovery in the dental market and the rebounding dental equipment business (especially in North America) assisted by increased technology marketing/promotional activities.
In this regard, the Zacks Consensus Estimate for Dental consumable and printed products is pegged at $319 million, down 0.3% from the previous quarter. The Zacks Consensus Estimate for equipment and software is pegged at $181 million, up 41.4% from the previous quarter.
Animal Health Segment
The segment is expected to see solid sales and market share gain in the second quarter. We believe the steady growth in this unit is a key long-term growth driver. Management at Patterson Companies expects solid margin improvement at the segment on enhanced partnerships with product manufacturers and strong sales execution.
However, our quantitative model does not conclusively show an earnings beat for Patterson Companies this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. This is not the case here, as you will see below.
Zacks ESP:The Earnings ESP for Patterson Companies is +0.23%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank:Patterson Companies currently carries a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement.
Here are some better-ranked companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat:
Veeva Systems Inc. (VEEV - Free Report) has an Earnings ESP of +1.15% and a Zacks Rank #3.
Agilent Technologies, Inc. (A - Free Report) has an Earnings ESP of +0.70% and a Zacks Rank #3.
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Patterson Companies (PDCO) Q2 Earnings: What's in Store?
Patterson Companies, Inc.’s (PDCO - Free Report) second-quarter fiscal 2018 results, scheduled for release on Nov 21, are expected to show steady growth in the Dental Supply segment — one of its major revenue components. While this could majorly drive second-quarter earnings, an expected improvement in revenues at all other segments should help the company generate solid results this season.
It is important to note that Patterson Companies’ last quarter earnings beat the Zacks Consensus Estimate by 2.3%. Similar to the prior quarter, strong growth in the Animal Health segment and consumable and printed products are expected to be the main factors driving second-quarter revenues.
The Zacks Consensus Estimate for the Dental Supply segment stands at $573 million for the second quarter. This reflects an increase of almost 10.4% from the last reported quarter. Meanwhile, the Zacks Consensus Estimate for operating income from the Animal Health unit is pegged at $22.9 million, up 37.4% from the preceding quarter.
Delving deeper into the fundamentals of the stock, let’s see how things are shaping up prior to this release.
Major Factors to Influence Q2
View Tepid
Management at Patterson Companies anticipates headwinds in its technology equipment business to persist through fiscal 2018. This is primarily because of Patterson Companies’ initiatives to transit its sales model to have an expanded technology product portfolio. In fact, the Zacks Consensus Estimate for earnings stands at 54 cents per share, down 4.2% year over year. Meanwhile, the Zacks Consensus Estimate for revenues is currently pegged at $1.42 billion, signifying 0.1% growth on a year-over-year basis.
Dental Unit
Patterson Companies have been investing in new digital technologies in its dental portfolio. Management expects these initiatives to drive sales in the second half of this fiscal. Further, the segment is expected to see solid margins in the second quarter. Patterson Companies is expected advantage from the gradual recovery in the dental market and the rebounding dental equipment business (especially in North America) assisted by increased technology marketing/promotional activities.
In this regard, the Zacks Consensus Estimate for Dental consumable and printed products is pegged at $319 million, down 0.3% from the previous quarter. The Zacks Consensus Estimate for equipment and software is pegged at $181 million, up 41.4% from the previous quarter.
Animal Health Segment
The segment is expected to see solid sales and market share gain in the second quarter. We believe the steady growth in this unit is a key long-term growth driver. Management at Patterson Companies expects solid margin improvement at the segment on enhanced partnerships with product manufacturers and strong sales execution.
Patterson Companies, Inc. Price and Consensus
Patterson Companies, Inc. Price and Consensus | Patterson Companies, Inc. Quote
However, our quantitative model does not conclusively show an earnings beat for Patterson Companies this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates. This is not the case here, as you will see below.
Zacks ESP:The Earnings ESP for Patterson Companies is +0.23%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank:Patterson Companies currently carries a Zacks Rank #4 (Sell). Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement.
Here are some better-ranked companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat:
Veeva Systems Inc. (VEEV - Free Report) has an Earnings ESP of +1.15% and a Zacks Rank #3.
The Cooper Companies Inc. (COO - Free Report) has an Earnings ESP of +0.58% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Agilent Technologies, Inc. (A - Free Report) has an Earnings ESP of +0.70% and a Zacks Rank #3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>