As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the dental equipment & technology industry, including Dentsply Sirona (NASDAQ:XRAY) and its peers.
The dental equipment and technology industry encompasses companies that manufacture orthodontic products, dental implants, imaging systems, and digital tools for dental professionals. These companies benefit from recurring revenue streams tied to consumables, ongoing maintenance, and growing demand for aesthetic and restorative dentistry. However, high R&D costs, significant capital investment requirements, and reliance on discretionary spending make them vulnerable to economic cycles. Over the next few years, tailwinds for the sector include innovation in digital workflows, such as 3D printing and AI-driven diagnostics, which enhance the efficiency and precision of dental care. However, headwinds include economic uncertainty, which could reduce patient spending on elective procedures, regulatory challenges, and potential pricing pressures from consolidated dental service organizations (DSOs).
The 4 dental equipment & technology stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.3% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 8.9% on average since the latest earnings results.
Weakest Q3: Dentsply Sirona (NASDAQ:XRAY)
With roots dating back to 1877 when it introduced the first dental electric drill, Dentsply Sirona (NASDAQ:XRAY) manufactures and sells professional dental equipment, technologies, and consumable products used by dentists and specialists worldwide.
Dentsply Sirona reported revenues of $904 million, down 4.9% year on year. This print exceeded analysts’ expectations by 0.5%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ full-year EPS guidance estimates.
"Third quarter results fell short of our expectations and reflect the operational and strategic challenges facing the business," said Dan Scavilla, President and Chief Executive Officer.
Dentsply Sirona delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. Unsurprisingly, the stock is down 10.9% since reporting and currently trades at $11.25.
Read our full report on Dentsply Sirona here, it’s free for active Edge members.
Best Q3: Envista (NYSE:NVST)
Uniting more than 30 trusted brands including Nobel Biocare, Ormco, and DEXIS under one corporate umbrella, Envista Holdings (NYSE:NVST) is a global dental products company that provides equipment, consumables, and specialized technologies for dental professionals.
Envista reported revenues of $669.9 million, up 11.5% year on year, outperforming analysts’ expectations by 4.6%. The business had an exceptional quarter with a solid beat of analysts’ constant currency revenue estimates and an impressive beat of analysts’ revenue estimates.
Envista delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 10.1% since reporting. It currently trades at $22.01.
Is now the time to buy Envista? Access our full analysis of the earnings results here, it’s free for active Edge members.
Align Technology (NASDAQ:ALGN)
Pioneering an alternative to traditional metal braces with nearly invisible plastic aligners, Align Technology (NASDAQ:ALGN) designs and manufactures Invisalign clear aligners, iTero intraoral scanners, and dental CAD/CAM software for orthodontic and restorative treatments.
Align Technology reported revenues of $995.7 million, up 1.8% year on year, exceeding analysts’ expectations by 2.2%. It may have had the worst quarter among its peers, but its results were still good as it also locked in a solid beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.
Interestingly, the stock is up 18.6% since the results and currently trades at $156.45.
Read our full analysis of Align Technology’s results here.
Henry Schein (NASDAQ:HSIC)
With a vast inventory of over 300,000 products stocked in distribution centers spanning more than 5.3 million square feet worldwide, Henry Schein (NASDAQ:HSIC) is a global distributor of healthcare products and services primarily to dental practices, medical offices, and other healthcare facilities.
Henry Schein reported revenues of $3.34 billion, up 5.2% year on year. This print beat analysts’ expectations by 1.9%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ full-year EPS guidance estimates and a decent beat of analysts’ revenue estimates.
The stock is up 17.9% since reporting and currently trades at $76.21.
Read our full, actionable report on Henry Schein here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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