DENTSPLY SIRONA (XRAY) Q1 Earnings In Line, Revenues Decline Y/Y

DENTSPLY SIRONA Inc. XRAY reported first-quarter 2024 adjusted earnings per share (EPS) of 42 cents, which aligns with the Zacks Consensus Estimate. The bottom line improved 7.9% on a year-over-year basis.

On a GAAP basis, the company reported an EPS of 9 cents against the loss of 9 cents per share reported in the year-ago quarter.

Revenues

Revenues in the reported quarter totaled $953 million, which missed the Zacks Consensus Estimate by 1.8%. The top line declined 2.6% year over year and 1.9% on an organic basis.

Business Details

The company reports quarterly results under four segments — Connected Technology Solutions, Essential Dental Solutions, Orthodontic and Implant Solutions, and Wellspect Healthcare.

While the Connected Technology Solutions segment consists of equipment, instruments and CAD/CAM business, the Orthodontic and Implant Solutions segment includes the implant systems and aligner solutions. These businesses were formerly part of the Technologies and Equipment segment.

The Essential Dental Solutions unit includes endodontic, restorative and preventive consumables businesses, which were part of the former Consumables segment. The Wellspect Healthcare segment includes the urology catheters business, a former part of Technologies & Equipment, and other healthcare-related consumable businesses, previously under the Consumables segment.

Connected Technology Solutions

Revenues in this segment totaled $247 million, down 6.9% year over year and 5.7% on an organic basis.

Orthodontic and Implant Solutions

Sales in this segment amounted to $271 million, up 4.4% year over year. On an organic basis, net sales improved 5.6%.

Essential Dental Solutions

Sales in this segment amounted to $364 million, down 5.9% year over year. On an organic basis, net sales declined 5.5%.

Wellspect Healthcare

Sales in this segment amounted to $71 million, up 5.4% year over year. On an organic basis, net sales improved 4.8%.

Revenues by Geography

In the United States, revenues increased 1.4% year over year organically to $356 million. Rest of World revenues decreased 0.1% organically to $221 million on a year-over-year basis. Revenues in Europe declined 5.8% to $376 million organically during the same time frame.

Margin Analysis

Gross profit in the reported quarter was $506 million, down 2.5% on a year-over-year basis. The gross margin came in at 53.1%, flat year over year.

Selling, general and administrative expenses totaled $415 million, down 0.2% from the year-ago quarter’s level. Research and development expenses amounted to $42 million, down 8.7% year over year.

Operating income totaled $42 million against the operating loss of $2 million in the year-ago period.

Financial Condition

DENTSPLY SIRONA exited the first quarter of 2024 with cash and cash equivalents of $291 million compared with $334 million at the end of the last reported quarter.

The cumulative net cash provided by operating activities totaled $25 million against net cash used in operating activities of $21 million in the year-ago period.

2024 Guidance Maintained

DENTSPLY SIRONA reiterated its guidance for 2024 earnings and revenues. The company expects sales in the band of $3.91-$3.97 billion, implying flat to 1.5% growth organically. The Zacks Consensus Estimate for the same is pegged at $3.99 billion.

XRAY expects adjusted EPS in the band of $2.00-$2.10. The Zacks Consensus Estimate for the same is pinned at $2.05.

Our Take

XRAY’s first-quarter adjusted earnings are in line while revenues missed the Zacks Consensus Estimate. Recovery of demand in China is likely to be a key driver of the top line going forward. Moreover, strong demand for aligners and CAD/CAM in the U.S. market will support revenue growth in the future.

DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise

DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise

DENTSPLY SIRONA Inc. price-consensus-eps-surprise-chart | DENTSPLY SIRONA Inc. Quote

Zacks Rank and Stocks to Consider

Currently, DENTSPLY SIRONA has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. ALGNEcolab ECL and Boston Scientific Corporation BSX.

Align Technology, carrying a Zacks Rank of 2 (Buy), reported first-quarter 2024 adjusted EPS of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Align Technology has a long-term estimated growth rate of 6.9%. ALGN’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.

Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 13.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 1.7%.

Ecolab’s shares have rallied 33.8% against the industry’s 9.3% decline in the past year.

Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.

Boston Scientific has a long-term estimated growth rate of 12.5%. BSX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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