Have you assessed how the international operations of Dentsply International (XRAY Quick QuoteXRAY - Free Report) performed in the quarter ended September 2024? For this dental products manufacturer, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.

In today's increasingly interconnected global economy, a company's ability to tap into international markets can be a pivotal factor in shaping its overall financial health and growth trajectory. For investors, understanding a company's reliance on overseas markets has become increasingly crucial, as it offers insights into the company's sustainability of earnings, ability to tap into diverse economic cycles and overall growth potential.

Participation in global economies acts as a defense against economic difficulties at home and a pathway to more rapidly developing economies. However, it also comes with the complexities of dealing with fluctuating currencies, geopolitical risks and different market dynamics.

Upon examining XRAY's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter amounted to $951 million, marking an increase of 0.4% from the year-ago quarter. We will next turn our attention to dissecting XRAY's international revenue to get a clearer picture of how significant its operations are outside its main base.

A Closer Look at XRAY's Revenue Streams Abroad

Of the total revenue, $347 million came from Europe during the last fiscal quarter, accounting for 36.49%. This represented a surprise of -3.31% as analysts had expected the region to contribute $358.89 million to the total revenue. In comparison, the region contributed $387 million, or 39.33%, and $354 million, or 37.38%, to total revenue in the previous and year-ago quarters, respectively.

Rest of World generated $230 million in revenues for the company in the last quarter, constituting 24.19% of the total. This represented a surprise of +1.53% compared to the $226.53 million projected by Wall Street analysts. Comparatively, in the previous quarter, Rest of World accounted for $237 million (24.09%), and in the year-ago quarter, it contributed $237 million (25.03%) to the total revenue.

International Revenue Predictions

For the current fiscal quarter, it is anticipated by Wall Street analysts that Dentsply will report a total revenue of $949.38 million, which reflects a decline of 6.2% from the same quarter in the previous year. The revenue contributions are expected to be 42.2% from Europe ($400.41 million) and 25.4% from Rest of World ($240.97 million).

For the full year, the company is projected to achieve a total revenue of $3.82 billion, which signifies a fall of 3.6% from the last year. The share of this revenue from various regions is expected to be: Europe at 39.9% ($1.52 billion) and Rest of World at 24.2% ($925.5 million).

Key Takeaways

Dentsply's reliance on international markets for revenues offers both opportunities and risks. Hence, keeping an eye on its international revenue trends could significantly help forecast the company's prospects.

In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' earnings forecasts.

Here at Zacks, we put a great deal of emphasis on a company's changing earnings outlook, as empirical research has shown that's a powerful force driving a stock's near-term price performance. Quite naturally, the correlation is positive here -- an upward revision in earnings estimates drives the stock price higher.

The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.

Currently, Dentsply holds a Zacks Rank #5 (Strong Sell), signifying its potential to underperform the overall market's performance in the forthcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Examining the Latest Trends in Dentsply's Stock Value

The stock has witnessed a decline of 27.2% over the past month versus the Zacks S&P 500 composite's an increase of 4.4%. In the same interval, the Zacks Medical sector, to which Dentsply belongs, has registered a decrease of 1.4%. Over the past three months, the company's shares saw a decrease of 30%, while the S&P 500 increased by 13.1%. In comparison, the sector experienced a decline of 2% during this timeframe.