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Dentsply (XRAY) Up 18.8% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Dentsply International (XRAY - Free Report) . Shares have added about 18.8% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Dentsply due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

DENTSPLY recently announced preliminary results for fourth-quarter 2018 wherein the top line surpassed the Zacks Consensus Estimate of $1.02 billion.

Revenues totaled at $1.06 billion, showing a fall of 2.9% year over year.

Adjusted earnings per share came in at 58 cents, beating the Zacks Consensus Estimate of 54 cents. Earnings declined 29.3% year over year.

2018 Results

Revenues in 2018 are expected at $4 billion, surpassing the Zacks Consensus Estimate of $3.94 billion. Revenues fell 0.2% from 2017.

Earnings per share for 2018 were $2.01, beating the Zacks Consensus Estimate of $1.97. The figure dropped 24.4% from 2017.

Quarter Highlights

Revenues in the fourth quarter are expected to see solid year-over-year increase of 4.6% in Europe and 1.4% in rest of the world. However, U.S. revenues declined 14.7% on a year-over-year basis in the quarter.

Fourth-quarter Consumable revenues increased 3.4% year over year. Notably, the segment benefited from a recovery in shipment levels at the company’s European distribution center in Venlo, the Netherlands.

Technology & Equipment revenues declined 7.4% year over year.

2019 View

For 2019, DENTSPLY expects adjusted earnings per share within the range of $2.25-$2.40. However, portfolio initiatives are expected to negatively impact 2019 revenues.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -7.09% due to these changes.

VGM Scores

Currently, Dentsply has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Notably, Dentsply has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.


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