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DENTSPLY SIRONA Inc. (XRAY - Free Report) reported first-quarter 2023 adjusted earnings per share (EPS) of 39 cents, which beat the Zacks Consensus Estimate of 33 cents by 18.2%. The bottom line, however, declined 27.8% on a year-over-year basis.
On a GAAP basis, the company incurred a loss of 9 cents per share against an EPS of 32 cents in the year-ago quarter.
Revenues
Revenues in the reported quarter totaled $978 million, which beat the Zacks Consensus Estimate by 5.1%. The top line also increased 0.9% year over year and improved 5.1% on an organic basis.
Business Details
Consumables
Revenues in the Consumables segment totaled $430 million, up 6.4% year over year and 9.8% on an organic basis. Strong retail demand for consumable products drove the segmental top line.
Technologies & Equipment
Sales in this segment amounted to $548 million, down 3% year over year. On an organic basis, net sales improved 1.7%. The organic growth was driven by strong aligners sales and additional CAD/CAM sales owing to favorable timing of dealer orders. However, implant sales in China were hurt due to volume-based procurement (VBP) policy that resulted in lower price per product, especially high-value products. Imaging and instruments volumes declined year over year.
Revenues by Geography
In the United States, revenues increased 13.9% year over year to $351 million. Rest of World revenues fell 7.6% year over year to $231 million. European revenues declined 3.6% year over year to $396 million. Sales in the U.S. and European markets increased 14.6% and 1.1%, respectively, on an organic basis. Organic sales declined 0.1% in the Rest of World market.
DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise
Gross profit in the reported quarter totaled $519 million, down 0.4% on a year-over-year basis. The gross margin was 53.1%, which contracted 70 basis points.
Selling, general and administrative expenses came in at $416 million, up 10.6% from the year-ago quarter’s level. Research and development expenses amounted to $46 million, up 2.2% from the prior-year quarter’s number.
Operating loss was $2 million against an operating income of $97 million in the year-ago period.
Financial Condition
DENTSPLY SIRONA exited the first quarter of 2023 with cash and cash equivalents of $318 million compared with $365 million at the end of the last-reported quarter.
Cumulative net cash used in operating activities was $21 million compared to cumulative net cash provided by operating activities of $93 million in the year-ago period.
2023 Guidance Updated
DENTSPLY SIRONA updated its guidance for revenues and earnings in 2023. The company raised the lower-end of its earlier revenue outlook by $50 million. It now projects sales in the range of $3.90-$3.95 billion. The Zacks Consensus Estimate for the same is pegged at $3.91 billion. Revenues are expected to be flat to up 2% organically.
XRAY now expects an adjusted EPS of $1.85-$2.00, raising only the lower-end of its earlier guidance by 5 cents. The Zacks Consensus Estimate for the same stands at $1.87.
Our Take
Although DENTSPLY SIRONA’s top line reflected soft demand in China due to VBP policy, it beat market expectations. Adjusted earnings also beat estimates amid inflationary pressure.
The company saw continued strong demand for aligners during the reported quarter. However, the ongoing macro headwinds impacted first-quarter results adversely. This trend is likely to continue through the rest of the year.
Zacks Rank and Stocks to Consider
Currently, DENTSPLY SIRONA has a Zacks Rank #3 (Hold).
Intuitive Surgical reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate of $1.19. Revenues of $1.7 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 1.86%.
Johnson & Johnson reported first-quarter 2023 adjusted EPS of $2.68, which beat the Zacks Consensus Estimate by 6.8%. Revenues of $24.75 billion outpaced the consensus mark by 5%.
Johnson & Johnson has a long-term estimated growth rate of 5.5%. JNJ’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.9%.
Edwards Lifesciences reported first-quarter 2023 adjusted earnings of 62 cents per share, which beat the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion surpassed the Zacks Consensus Estimate by 4.7%.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 1.69%.
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DENTSPLY SIRONA (XRAY) Q1 Earnings & Revenues Beat Estimates
DENTSPLY SIRONA Inc. (XRAY - Free Report) reported first-quarter 2023 adjusted earnings per share (EPS) of 39 cents, which beat the Zacks Consensus Estimate of 33 cents by 18.2%. The bottom line, however, declined 27.8% on a year-over-year basis.
On a GAAP basis, the company incurred a loss of 9 cents per share against an EPS of 32 cents in the year-ago quarter.
Revenues
Revenues in the reported quarter totaled $978 million, which beat the Zacks Consensus Estimate by 5.1%. The top line also increased 0.9% year over year and improved 5.1% on an organic basis.
Business Details
Consumables
Revenues in the Consumables segment totaled $430 million, up 6.4% year over year and 9.8% on an organic basis. Strong retail demand for consumable products drove the segmental top line.
Technologies & Equipment
Sales in this segment amounted to $548 million, down 3% year over year. On an organic basis, net sales improved 1.7%. The organic growth was driven by strong aligners sales and additional CAD/CAM sales owing to favorable timing of dealer orders. However, implant sales in China were hurt due to volume-based procurement (VBP) policy that resulted in lower price per product, especially high-value products. Imaging and instruments volumes declined year over year.
Revenues by Geography
In the United States, revenues increased 13.9% year over year to $351 million. Rest of World revenues fell 7.6% year over year to $231 million. European revenues declined 3.6% year over year to $396 million. Sales in the U.S. and European markets increased 14.6% and 1.1%, respectively, on an organic basis. Organic sales declined 0.1% in the Rest of World market.
DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise
DENTSPLY SIRONA Inc. price-consensus-eps-surprise-chart | DENTSPLY SIRONA Inc. Quote
Margin Analysis
Gross profit in the reported quarter totaled $519 million, down 0.4% on a year-over-year basis. The gross margin was 53.1%, which contracted 70 basis points.
Selling, general and administrative expenses came in at $416 million, up 10.6% from the year-ago quarter’s level. Research and development expenses amounted to $46 million, up 2.2% from the prior-year quarter’s number.
Operating loss was $2 million against an operating income of $97 million in the year-ago period.
Financial Condition
DENTSPLY SIRONA exited the first quarter of 2023 with cash and cash equivalents of $318 million compared with $365 million at the end of the last-reported quarter.
Cumulative net cash used in operating activities was $21 million compared to cumulative net cash provided by operating activities of $93 million in the year-ago period.
2023 Guidance Updated
DENTSPLY SIRONA updated its guidance for revenues and earnings in 2023. The company raised the lower-end of its earlier revenue outlook by $50 million. It now projects sales in the range of $3.90-$3.95 billion. The Zacks Consensus Estimate for the same is pegged at $3.91 billion. Revenues are expected to be flat to up 2% organically.
XRAY now expects an adjusted EPS of $1.85-$2.00, raising only the lower-end of its earlier guidance by 5 cents. The Zacks Consensus Estimate for the same stands at $1.87.
Our Take
Although DENTSPLY SIRONA’s top line reflected soft demand in China due to VBP policy, it beat market expectations. Adjusted earnings also beat estimates amid inflationary pressure.
The company saw continued strong demand for aligners during the reported quarter. However, the ongoing macro headwinds impacted first-quarter results adversely. This trend is likely to continue through the rest of the year.
Zacks Rank and Stocks to Consider
Currently, DENTSPLY SIRONA has a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the broader medical space that have announced their quarterly results are Intuitive Surgical (ISRG - Free Report) , Johnson & Johnson (JNJ - Free Report) and Edwards Lifesciences (EW - Free Report) , each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Intuitive Surgical reported first-quarter 2023 adjusted EPS of $1.23, which beat the Zacks Consensus Estimate of $1.19. Revenues of $1.7 billion outpaced the consensus mark by 6.9%.
Intuitive Surgical has a long-term estimated growth rate of 13%. ISRG’s earnings surpassed estimates in two of the trailing four quarters and missed the same twice, the average surprise being 1.86%.
Johnson & Johnson reported first-quarter 2023 adjusted EPS of $2.68, which beat the Zacks Consensus Estimate by 6.8%. Revenues of $24.75 billion outpaced the consensus mark by 5%.
Johnson & Johnson has a long-term estimated growth rate of 5.5%. JNJ’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 3.9%.
Edwards Lifesciences reported first-quarter 2023 adjusted earnings of 62 cents per share, which beat the Zacks Consensus Estimate by 1.6%. Revenues of $1.46 billion surpassed the Zacks Consensus Estimate by 4.7%.
Edwards Lifesciences has a long-term estimated growth rate of 6.8%. EW’s earnings surpassed estimates in three of the trailing four quarters and missed the same once, the average surprise being 1.69%.