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On Apr 1, 2013, we retained DENTSPLY International Inc. (XRAY - Analyst Report) at Neutral after the company beat Zacks Consensus Estimates for earnings and revenue for fourth quarter 2012.

Why the Retention?

DENTSPLY released its results for the fourth quarter on Feb 20. The company posted adjusted earnings per share of 56 cents per share, which was better than the Zacks Consensus Estimate of earnings of 55 cents a share.

Revenues in the reported quarter improved 2.1% year over year to $753.3 million, beating the Zacks Consensus Estimate of $747 million. Excluding precious metal content, net sales increased 3.8% (up 5.9% in constant currency) to $703.5 million. 

Over the past 60 days, the Zacks Consensus Estimate for 2013 has dropped by 2 cents to $2.43. For 2014, the Zacks Consensus Estimate has moved up by two pennies to $2.68 during the same timeframe.

Based on the improving global dental market trends along with the impact of currency rates, DENTSPLY expects to generate adjusted earnings per share in the band of $2.38 and $2.48 for 2013.

DENTSPLY’s overall growth strategy rests on product innovation. It boasts solid internal growth despite often challenging macroeconomic headwinds on the back of innovative new products. Furthermore, DENTSPLY has a strong international presence. The company’s products are used in over 120 countries. Finally, the company has a healthy pipeline for 2013.

DENTSPLY’s acquisition of Astra Tech has reinforced its foothold in the global dental market. DENTSPLY expects to benefit from the gradual recovery in the global dental market. We believe that the current reasonable condition of the world economy offers only modest growth prospects.

Other Stocks to Consider

We currently have a Zacks Rank #3 (Hold) on DENTSPLY. We are more positive about Becton, Dickinson and Company (BDX - Analyst Report), The Cooper Companies Inc. (COO - Analyst Report) and Henry Schein, Inc. (HSIC - Analyst Report) each of which carry a Zacks Rank #2 (Buy) and are expected to do well.

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