Back to top

Image: Bigstock

What's in Store for Patterson Companies' (PDCO) Q1 Earnings?

Read MoreHide Full Article

Patterson Companies, Inc. (PDCO - Free Report) is scheduled to release first-quarter fiscal 2021 results on Sep 3, before the opening bell.

The company delivered earnings surprise of 152.9% in the last reported quarter. Further, it beat estimates in each of the trailing four quarters, the average surprise being 49.9%.

Fiscal Q1 Estimates

For the quarter to be reported, the Zacks Consensus Estimate for the company’s revenues is pegged at $1.16 billion, suggesting a decline of 12.5% from the year-ago reported number. The same for adjusted earnings per share (EPS) stands at 21 cents, indicating a decline of 22.2% from the prior-year quarter.

Factors to Note

Being one of the leading distributors of consumable products and dental technology, Patterson Companies’ Dental arm has been one of the key contributors to its top line.

However, the fiscal first quarter bore the brunt of the COVID-19 pandemic, thereby leading to dental practice closures. Consequently, this might get reflected in the Dental segment’s revenues in the to-be-reported quarter.

Patterson Companies, Inc. Price and EPS Surprise

Patterson Companies, Inc. Price and EPS Surprise

Patterson Companies, Inc. price-eps-surprise | Patterson Companies, Inc. Quote

With regard to Animal Health business, the company is likely to have witnessed lower revenues in the fiscal first quarter as a result of the direct impact of the pandemic.

Nonetheless, the company might have experienced improving trends in its production business despite challenges in the beef and dairy end markets.

Further, robust demand for the segment’s products like x-ray film, restorative materials, sterilization products, hand instruments and advanced dental equipment may have contributed to the company’s performance in the quarter to be reported.

Additionally, the company’s focused and disciplined approach to boost execution and fortify its value proposition is likely to have benefited the top line and margin expansion in the fiscal first quarter.

During fiscal third-quarter 2020, Patterson Companies signed and extended its multiyear agreement with Pacific Dental Services, which is one of the premier Dental Support Organizations (DSO) in the United States. This, in turn, is anticipated to have positively impacted the company’s performance in the fiscal first quarter.

However, intense competition across most of the product lines might have weighed on the company’s overall performance in the to-be-reported quarter.

What Our Model Says

Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is the case here as you will see.

Earnings ESP: Patterson Companies has an Earnings ESP of +19.78%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3.

Peer Releases

Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , PerkinElmer, Inc. (PKI - Free Report) and West Pharmaceutical Services, Inc. (WST - Free Report) . While PerkinElmer sports a Zacks Rank of 1, both Thermo Fisher and West Pharmaceuticals carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

PerkinElmer reported second-quarter 2020 adjusted EPS of $1.57, which surpassed the Zacks Consensus Estimate by 68.8%. Revenues of $811.7 million outpaced the consensus mark by 1.3%.

Thermo Fisher reported second-quarter 2020 adjusted EPS of $3.89, beating the Zacks Consensus Estimate by 45.7%. Revenues of $6.92 billion surpassed the consensus mark by 0.1%.

West Pharmaceuticals reported second-quarter 2020 adjusted EPS of $1.25, outpacing the Zacks Consensus Estimate of 91 cents. Revenues of $527.2 million surpassed the consensus mark by 6.9%.

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>>