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Can Geographical Sales Aid DENTSPLY's (XRAY) Q4 Earnings?
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DENTSPLY SIRONA Inc. (XRAY - Free Report) is expected to report fourth-quarter 2017 results on Feb 16, before the market opens.
The company is expected to see sluggishness in the Ex Precious Metal Segment — one of the major revenue components. This is expected to dampen fourth-quarter results, which might be compensated by improving revenues in other segments.
The Zacks Consensus Estimate for U.S. revenues at the Ex Precious Metal Segment is $348 million, down 3.9% from the last quarter. Not just in the United States, the segment is likely to put up an unimpressive show in Europe and Rest of the World. The Zacks Consensus Estimate for revenues from the segment in Europe is pegged at $404 million, showing a 6.3% drop from the figure reported in the previous quarter. Further, the consensus estimate for revenues in the segment from the Rest of the World is pegged at $274 million, showing a 6.2% decline from the reported figure in the last quarter.
Moreover, DENTSPLY has been performing unfavorably compared with the broader industry over the last year. The stock has gained 2.4% compared with the industry’s rally of 21.5%.
However, DENTSPLY delivered a positive average earnings surprise of 0.93% in the trailing four quarters. In the previous quarter, the company reported earnings of 70 cents per share, topping the Zacks Consensus Estimate by 4 cents. Earnings also rose 6.1% on a year-over-year basis.
Why Dull Estimates for Ex Precious Metal Segment?
Sales of the company’s precious-metal dental alloy products, which are used by third parties to construct crown and bridge materials, are subject to risks from fluctuations of precious metal prices.
In the last quarter, revenues in Europe and Rest of the World at the Ex Precious Metal segment deteriorated on a sequential basis. In Europe, revenues declined 3.8% to $380 billion, while revenues in Rest of the World fell 0.4% to $258 million. The lackluster trend is likely to persist in the to-be-reported quarter as well.
To avoid the impact of fluctuating prices, DENTSPLY reports net sales with and without precious metal content to show actual performance, independent of precious metal price volatility.
Let’s see how things are shaping up prior to this announcement.
Factors at Play
Consistent Efforts to Achieve Operational Excellence: DENTSPLY is poised to become one of the best operators in the dental industry in terms of cost, quality and overall efficiency. Management consistently focuses on operational expenses and is contemplating to cut an additional $100 million of costs in 2018 and 2019. Apart from plans of expense control, the company intends to drive revenue synergies well beyond this target. We believe that the company’s cost-control efficiencies will be accretive to fourth-quarter results.
View for Q4 and 2017: The Zacks Consensus Estimate for fourth-quarter revenues is pinned at $1.06 billion, indicating year-over-year growth of 6.05%.
While reporting its third quarter, DENTSPLY narrowed its adjusted earnings per share guidance for 2017 to the range of $2.65 to $2.70 from the earlier $2.65 to $2.75. Further, the Zacks Consensus Estimate for 2017 earnings is pegged at $2.65, reflecting a year-over-year decline of 4.68%. However, for the fourth quarter, the Zacks Consensus Estimate for adjusted earnings per share is 81 cents, showing year-over-year growth of 20.9%.
Debt Dependence: DENTSPLY exited the third quarter with long-term debt of $1.6 billion. Large amounts of debt are likely to hamper the company’s prospects, in terms of product innovation.
Plagued by the above headwinds, DENTSPLY is unlikely to deliver an earnings beat in fourth-quarter 2017.
Earnings Whispers
Our proven model does not conclusively indicate earnings beat for DENTSPLY in this quarter. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: DENTSPLY has an Earnings ESP of +0.58%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Earnings ESP Filter.
Zacks Rank: DENTSPLY carries a Zacks Rank #4 (Sell). An unfavorable Zacks Rank makes surprise prediction difficult.
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
AmerisourceBergen has an Earnings ESP of +1.40% and a Zacks Rank #3.
Cooper Companies (COO - Free Report) has an Earnings ESP of +1.18% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Can Geographical Sales Aid DENTSPLY's (XRAY) Q4 Earnings?
DENTSPLY SIRONA Inc. (XRAY - Free Report) is expected to report fourth-quarter 2017 results on Feb 16, before the market opens.
The company is expected to see sluggishness in the Ex Precious Metal Segment — one of the major revenue components. This is expected to dampen fourth-quarter results, which might be compensated by improving revenues in other segments.
The Zacks Consensus Estimate for U.S. revenues at the Ex Precious Metal Segment is $348 million, down 3.9% from the last quarter. Not just in the United States, the segment is likely to put up an unimpressive show in Europe and Rest of the World. The Zacks Consensus Estimate for revenues from the segment in Europe is pegged at $404 million, showing a 6.3% drop from the figure reported in the previous quarter. Further, the consensus estimate for revenues in the segment from the Rest of the World is pegged at $274 million, showing a 6.2% decline from the reported figure in the last quarter.
DENTSPLY SIRONA Inc. Price and Consensus
DENTSPLY SIRONA Inc. Price and Consensus | DENTSPLY SIRONA Inc. Quote
Moreover, DENTSPLY has been performing unfavorably compared with the broader industry over the last year. The stock has gained 2.4% compared with the industry’s rally of 21.5%.
However, DENTSPLY delivered a positive average earnings surprise of 0.93% in the trailing four quarters. In the previous quarter, the company reported earnings of 70 cents per share, topping the Zacks Consensus Estimate by 4 cents. Earnings also rose 6.1% on a year-over-year basis.
Why Dull Estimates for Ex Precious Metal Segment?
Sales of the company’s precious-metal dental alloy products, which are used by third parties to construct crown and bridge materials, are subject to risks from fluctuations of precious metal prices.
In the last quarter, revenues in Europe and Rest of the World at the Ex Precious Metal segment deteriorated on a sequential basis. In Europe, revenues declined 3.8% to $380 billion, while revenues in Rest of the World fell 0.4% to $258 million. The lackluster trend is likely to persist in the to-be-reported quarter as well.
To avoid the impact of fluctuating prices, DENTSPLY reports net sales with and without precious metal content to show actual performance, independent of precious metal price volatility.
Let’s see how things are shaping up prior to this announcement.
Factors at Play
Consistent Efforts to Achieve Operational Excellence: DENTSPLY is poised to become one of the best operators in the dental industry in terms of cost, quality and overall efficiency. Management consistently focuses on operational expenses and is contemplating to cut an additional $100 million of costs in 2018 and 2019. Apart from plans of expense control, the company intends to drive revenue synergies well beyond this target. We believe that the company’s cost-control efficiencies will be accretive to fourth-quarter results.
View for Q4 and 2017: The Zacks Consensus Estimate for fourth-quarter revenues is pinned at $1.06 billion, indicating year-over-year growth of 6.05%.
While reporting its third quarter, DENTSPLY narrowed its adjusted earnings per share guidance for 2017 to the range of $2.65 to $2.70 from the earlier $2.65 to $2.75. Further, the Zacks Consensus Estimate for 2017 earnings is pegged at $2.65, reflecting a year-over-year decline of 4.68%. However, for the fourth quarter, the Zacks Consensus Estimate for adjusted earnings per share is 81 cents, showing year-over-year growth of 20.9%.
Debt Dependence: DENTSPLY exited the third quarter with long-term debt of $1.6 billion. Large amounts of debt are likely to hamper the company’s prospects, in terms of product innovation.
Plagued by the above headwinds, DENTSPLY is unlikely to deliver an earnings beat in fourth-quarter 2017.
Earnings Whispers
Our proven model does not conclusively indicate earnings beat for DENTSPLY in this quarter. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: DENTSPLY has an Earnings ESP of +0.58%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Earnings ESP Filter.
Zacks Rank: DENTSPLY carries a Zacks Rank #4 (Sell). An unfavorable Zacks Rank makes surprise prediction difficult.
Stocks Worth a Look
Here are a few medical stocks worth considering as they have the right combination of elements to post an earnings beat this quarter.
AmerisourceBergen has an Earnings ESP of +1.40% and a Zacks Rank #3.
Centene (CNC - Free Report) has an Earnings ESP of +0.92% and a Zacks Rank #1. You can see see the complete list of today’s Zacks #1 Rank stocks here.
Cooper Companies (COO - Free Report) has an Earnings ESP of +1.18% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>