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Henry Schein (HSIC) International Growth Solid, Dental Rebounds
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Henry Schein (HSIC - Free Report) is well positioned to gain from its extensive global foothold and diverse channel mix. The stock carries a Zacks Rank #2 (Buy).
In the past year, Henry Schein has outperformed the industry. The stock has gained 3.2% against the industry's 5.4% decline.
Henry Schein ended the fourth quarter of 2022 with in-line earnings and better-than-expected revenues. Growth in the Technology and Value-added Services business was strongest in the international business, banking on the strength of the Dentally cloud-based solution.
Growth in North America was driven by sales of practice management software. Sales growth in the Medical business continued to be robust, reflecting higher patient traffic to alternate care sites. Widespread network and channel mix and favorable long-term trends in the dental business look encouraging. A strong solvency position is a plus.
Henry Schein’s distribution business boasts a wide global footprint with 61 distribution centers. Apart from North America and Canada, the company has a presence in Australia and New Zealand as well as in emerging nations like China, Brazil, Israel, the Czech Republic and Poland. We believe Henry Schein’s worldwide reach is a major competitive advantage over other players in the healthcare distribution industry.
Global Dental consumable merchandise local currency internal (LCI) sales increased 1%, excluding PPE products, while Global Dental equipment LCI growth was 0.7%. Global technology and value-added services sales LCI growth was 3.4%. In North America, excluding sales of PPE products and COVID-19 test kits, Medical LCI sales grew 14.9%, led by strong point-of-care diagnostics, medical equipment and pharmaceutical sales. Moreover, the company’s BioHorizons premium value implant segment continues to grow in North America and Europe.
On the flip side, Henry Schein’s fourth-quarter revenues were affected by a decline in sales of PPE products and COVID-19 test kits. Global Dental LCI sales decreased 2.6%. Global Dental consumable merchandise LCI sales decreased 3.7%. North America Dental LCI sales decreased 3.4% compared with the prior year, primarily due to a 5.1% decline in consumable merchandise sales.
Moreover, international Dental LCI sales decreased 1.4% and consumable merchandise LCI sales decreased 1.7%. Escalating operating expenses and contraction of operating margin remain concerns.
The healthcare industry has been facing numerous headwinds such as measures to curb capital expenditure, volume and FX headwinds, pricing pressure, supply disruption and procedure deferrals among others. Amid these, some large integrated healthcare providers and Group Purchasing Organizations (GPO) have gained considerable purchasing power. The GPOs act as agents that negotiate vendor contracts on behalf of their members.
Moreover, the ongoing economic climate bolstered the bargaining power of GPOs, which have increased pricing pressure in the industry. This might be a drag on Henry Schein’s business in the upcoming period.
Other Key Picks
Some other top-ranked stocks in the overall healthcare sector include Haemonetics Corporation (HAE - Free Report) , TerrAscend Corp. and Akerna Corp. . Haemonetics and TerrAscend both sport a Zacks Rank #1 (Strong Buy), while Akerna carries a Zack Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Haemonetics’ stock has risen 42.1% in the past year. Earnings estimates for Haemonetics have increased from $2.87 per share to 2.91 for 2023 and from $3.02 per share to $3.28 for 2024 in the past 30 days.
HAE’s earnings beat estimates in each of the last four quarters, delivering an average surprise of 10.98%. In the last reported quarter, it delivered an earnings surprise of 7.59%.
Estimates for TerrAscend’s 2023 bottom line have remained constant at a loss of 10 cents per share in the past 30 days. Shares of TerrAscend have declined 70.6% in the past year.
TerrAscend’s earnings beat estimates in one of the last three quarters and missed the mark in the other two, the average negative surprise being 136.11%. In the last reported quarter, TRSSF delivered an earnings surprise of 216.67%.
Akerna’s stock has declined 95.7% in the past year. Estimates for 2023 have remained constant at a loss of $1.91 per share over the past 30 days.
Akerna missed earnings estimates in each of the last four quarters, delivering a negative earnings surprise of 15.49%, on average. In the last reported quarter, KERN delivered a negative earnings surprise of 13.33%.
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Henry Schein (HSIC) International Growth Solid, Dental Rebounds
Henry Schein (HSIC - Free Report) is well positioned to gain from its extensive global foothold and diverse channel mix. The stock carries a Zacks Rank #2 (Buy).
In the past year, Henry Schein has outperformed the industry. The stock has gained 3.2% against the industry's 5.4% decline.
Henry Schein ended the fourth quarter of 2022 with in-line earnings and better-than-expected revenues. Growth in the Technology and Value-added Services business was strongest in the international business, banking on the strength of the Dentally cloud-based solution.
Growth in North America was driven by sales of practice management software. Sales growth in the Medical business continued to be robust, reflecting higher patient traffic to alternate care sites. Widespread network and channel mix and favorable long-term trends in the dental business look encouraging. A strong solvency position is a plus.
Henry Schein, Inc. Price
Henry Schein, Inc. price | Henry Schein, Inc. Quote
Henry Schein’s distribution business boasts a wide global footprint with 61 distribution centers. Apart from North America and Canada, the company has a presence in Australia and New Zealand as well as in emerging nations like China, Brazil, Israel, the Czech Republic and Poland. We believe Henry Schein’s worldwide reach is a major competitive advantage over other players in the healthcare distribution industry.
Global Dental consumable merchandise local currency internal (LCI) sales increased 1%, excluding PPE products, while Global Dental equipment LCI growth was 0.7%. Global technology and value-added services sales LCI growth was 3.4%. In North America, excluding sales of PPE products and COVID-19 test kits, Medical LCI sales grew 14.9%, led by strong point-of-care diagnostics, medical equipment and pharmaceutical sales. Moreover, the company’s BioHorizons premium value implant segment continues to grow in North America and Europe.
On the flip side, Henry Schein’s fourth-quarter revenues were affected by a decline in sales of PPE products and COVID-19 test kits. Global Dental LCI sales decreased 2.6%. Global Dental consumable merchandise LCI sales decreased 3.7%. North America Dental LCI sales decreased 3.4% compared with the prior year, primarily due to a 5.1% decline in consumable merchandise sales.
Moreover, international Dental LCI sales decreased 1.4% and consumable merchandise LCI sales decreased 1.7%. Escalating operating expenses and contraction of operating margin remain concerns.
The healthcare industry has been facing numerous headwinds such as measures to curb capital expenditure, volume and FX headwinds, pricing pressure, supply disruption and procedure deferrals among others. Amid these, some large integrated healthcare providers and Group Purchasing Organizations (GPO) have gained considerable purchasing power. The GPOs act as agents that negotiate vendor contracts on behalf of their members.
Moreover, the ongoing economic climate bolstered the bargaining power of GPOs, which have increased pricing pressure in the industry. This might be a drag on Henry Schein’s business in the upcoming period.
Other Key Picks
Some other top-ranked stocks in the overall healthcare sector include Haemonetics Corporation (HAE - Free Report) , TerrAscend Corp. and Akerna Corp. . Haemonetics and TerrAscend both sport a Zacks Rank #1 (Strong Buy), while Akerna carries a Zack Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Haemonetics’ stock has risen 42.1% in the past year. Earnings estimates for Haemonetics have increased from $2.87 per share to 2.91 for 2023 and from $3.02 per share to $3.28 for 2024 in the past 30 days.
HAE’s earnings beat estimates in each of the last four quarters, delivering an average surprise of 10.98%. In the last reported quarter, it delivered an earnings surprise of 7.59%.
Estimates for TerrAscend’s 2023 bottom line have remained constant at a loss of 10 cents per share in the past 30 days. Shares of TerrAscend have declined 70.6% in the past year.
TerrAscend’s earnings beat estimates in one of the last three quarters and missed the mark in the other two, the average negative surprise being 136.11%. In the last reported quarter, TRSSF delivered an earnings surprise of 216.67%.
Akerna’s stock has declined 95.7% in the past year. Estimates for 2023 have remained constant at a loss of $1.91 per share over the past 30 days.
Akerna missed earnings estimates in each of the last four quarters, delivering a negative earnings surprise of 15.49%, on average. In the last reported quarter, KERN delivered a negative earnings surprise of 13.33%.