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XRAY Q4 Earnings & Revenues Miss Estimates, Gross Margin Down
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DENTSPLY SIRONA Inc. (XRAY - Free Report) reported fourth-quarter 2024 adjusted earnings per share (EPS) of 26 cents, which missed the Zacks Consensus Estimate of 43 cents by 39.5%. The bottom line decreased 40.9% on a year-over-year basis.
On a GAAP basis, the company reported a loss of $2.16 per share against 32 cents in the year-ago quarter.
In October 2024, XRAY announced the voluntary suspension of sales and marketing of its Byte Aligners and Impression Kits while it conducts a review of certain regulatory requirements related to these products.
Revenues in the reported quarter totaled $905 million, missing the Zacks Consensus Estimate by 1.6%. The top line declined 10.6% year over year and 10.7% on an organic basis. The fourth quarter revenues included Byte sales impact of 6%.
XRAY’s Full-Year 2024 Results
For the full-year 2024, XRAY registered total sales of $3.79 billion, down 4.3% year over year and 3.5% on an organic basis. 2024 revenues included Byte sales impact of 1.2%.
XRAY reported adjusted EPS of $1.67 for 2024, down 8.8% compared with 2023.
Business Details of XRAY
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 businesses, 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 $293 million, down 8.3% year over year and 8.4% on an organic basis.
Orthodontic and Implant Solutions
Sales in this segment amounted to $185 million, down 28.6% year over year and 28.7% on an organic basis. The decline included $62 million of Byte sales impact, partially offset by continued growth in SureSmile.
Essential Dental Solutions
Sales in this segment amounted to $346 million, down 3.5% year over year. On an organic basis, net sales declined 3.4%. The decline was due to an approximately ($20 million) impact from the timing of orders in the United States due to ERP, offset by higher volumes in Rest of World.
Wellspect Healthcare
Sales in this segment amounted to $81 million, up 8.6% year over year. On an organic basis, net sales improved 6.7%. The growth was driven by product innovation.
XRAY’s Revenues by Geography
In the United States, revenues decreased 29.9% year over year organically to $259 million. Rest of World revenues decreased 2% organically to $238 million. Revenues in Europe improved 1.8% organically on a year-over-year basis to $408 million.
XRAY’s Margin Analysis
Adjusted gross profit in the reported quarter was $477 million, down 14.5% on a year-over-year basis. The adjusted gross margin was 52.7%, contracting 240 basis points (bps) year over year.
Selling, general and administrative expenses totaled $401 million, down 1.9% from the year-ago quarter’s level. Research and development expenses amounted to $42 million, down 2.3% year over year.
Adjusted operating income in the reported quarter amounted to $96 million, down 32.9% from the year-ago period’s level. Adjusted operating margin was 10.6, contracting 350 bps year over year.
DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise
DENTSPLY SIRONA exited the fourth quarter of 2024 with cash and cash equivalents of $272 million compared with $296 million at the third-quarter end.
The cumulative net cash provided by operating activities totaled $461 million compared with $377 million in the year-ago period.
XRAY’s 2025 Guidance Revised
DENTSPLY SIRONA provided its guidance for the full-year 2025 earnings and revenues. The company now expects net sales in the range of $3.50 billion to $3.60 billion, down 4-2% on an organic basis, which includes a 2% Byte sales impact. The Zacks Consensus Estimate for the same is pegged at $3.74 billion.
XRAY expects adjusted EPS in the band of $1.80-$2.00. The Zacks Consensus Estimate for earnings is pinned at $1.90 per share.
Our Take on XRAY
XRAY ended the fourth quarter on a dismal note, wherein both earnings and revenues missed their respective estimates. Also, a full-year 2025 outlook for declining revenues does not bode well. However, shares were up 1.1% during pre-market trading. The stock plunged 23.9% in the past six months against the industry and the S&P 500’s growth of 0.1% and 7%, respectively.
Per management,Byte, persistent macro pressures and competitive dynamics negatively impacted fourth-quarter and 2024 results. Also, improvements in the fourth quarter included a return to growth in Europe and imaging globally, as well as continued growth of Wellspect Healthcare and SureSmile.
Image Source: Zacks Investment Research
XRAY’s Zacks Rank & Stocks to Consider
XRAY carries a Zacks Rank #4 (Sell) at present.
Some better-ranked stocks in the broader medical space that have announced quarterly results are Cardinal Health, Inc. (CAH - Free Report) , ResMed Inc. (RMD - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Cardinal Health, carrying a Zacks Rank #2 (Buy), reported second-quarter fiscal 2025 adjusted EPS of $1.93, beating the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion outpaced the consensus mark by 0.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cardinal Health has a long-term estimated growth rate of 10.7%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
ResMedreported second-quarter fiscal 2025 adjusted EPS of $2.43, beating the Zacks Consensus Estimate by 5.7%. Revenues of $1.28 billion surpassed the Zacks Consensus Estimate by 1.6%. It currently carries a Zacks Rank #2.
ResMedhas a long-term estimated growth rate of 16%. RMD’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Boston Scientificreported fourth-quarter 2024 adjusted EPS of 70 cents, beating the Zacks Consensus Estimate by 7.7%. Revenues of $4.56 billion surpassed the Zacks Consensus Estimate by 3.5%. It currently carries a Zacks Rank #2.
Boston Scientifichas a long-term estimated growth rate of 13.3%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.3%.
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XRAY Q4 Earnings & Revenues Miss Estimates, Gross Margin Down
DENTSPLY SIRONA Inc. (XRAY - Free Report) reported fourth-quarter 2024 adjusted earnings per share (EPS) of 26 cents, which missed the Zacks Consensus Estimate of 43 cents by 39.5%. The bottom line decreased 40.9% on a year-over-year basis.
On a GAAP basis, the company reported a loss of $2.16 per share against 32 cents in the year-ago quarter.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
XRAY’s Revenue Details
In October 2024, XRAY announced the voluntary suspension of sales and marketing of its Byte Aligners and Impression Kits while it conducts a review of certain regulatory requirements related to these products.
Revenues in the reported quarter totaled $905 million, missing the Zacks Consensus Estimate by 1.6%. The top line declined 10.6% year over year and 10.7% on an organic basis. The fourth quarter revenues included Byte sales impact of 6%.
XRAY’s Full-Year 2024 Results
For the full-year 2024, XRAY registered total sales of $3.79 billion, down 4.3% year over year and 3.5% on an organic basis. 2024 revenues included Byte sales impact of 1.2%.
XRAY reported adjusted EPS of $1.67 for 2024, down 8.8% compared with 2023.
Business Details of XRAY
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 businesses, 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 $293 million, down 8.3% year over year and 8.4% on an organic basis.
Orthodontic and Implant Solutions
Sales in this segment amounted to $185 million, down 28.6% year over year and 28.7% on an organic basis. The decline included $62 million of Byte sales impact, partially offset by continued growth in SureSmile.
Essential Dental Solutions
Sales in this segment amounted to $346 million, down 3.5% year over year. On an organic basis, net sales declined 3.4%. The decline was due to an approximately ($20 million) impact from the timing of orders in the United States due to ERP, offset by higher volumes in Rest of World.
Wellspect Healthcare
Sales in this segment amounted to $81 million, up 8.6% year over year. On an organic basis, net sales improved 6.7%. The growth was driven by product innovation.
XRAY’s Revenues by Geography
In the United States, revenues decreased 29.9% year over year organically to $259 million. Rest of World revenues decreased 2% organically to $238 million. Revenues in Europe improved 1.8% organically on a year-over-year basis to $408 million.
XRAY’s Margin Analysis
Adjusted gross profit in the reported quarter was $477 million, down 14.5% on a year-over-year basis. The adjusted gross margin was 52.7%, contracting 240 basis points (bps) year over year.
Selling, general and administrative expenses totaled $401 million, down 1.9% from the year-ago quarter’s level. Research and development expenses amounted to $42 million, down 2.3% year over year.
Adjusted operating income in the reported quarter amounted to $96 million, down 32.9% from the year-ago period’s level. Adjusted operating margin was 10.6, contracting 350 bps year over year.
DENTSPLY SIRONA Inc. Price, Consensus and EPS Surprise
DENTSPLY SIRONA Inc. price-consensus-eps-surprise-chart | DENTSPLY SIRONA Inc. Quote
Financial Update of XRAY
DENTSPLY SIRONA exited the fourth quarter of 2024 with cash and cash equivalents of $272 million compared with $296 million at the third-quarter end.
The cumulative net cash provided by operating activities totaled $461 million compared with $377 million in the year-ago period.
XRAY’s 2025 Guidance Revised
DENTSPLY SIRONA provided its guidance for the full-year 2025 earnings and revenues. The company now expects net sales in the range of $3.50 billion to $3.60 billion, down 4-2% on an organic basis, which includes a 2% Byte sales impact. The Zacks Consensus Estimate for the same is pegged at $3.74 billion.
XRAY expects adjusted EPS in the band of $1.80-$2.00. The Zacks Consensus Estimate for earnings is pinned at $1.90 per share.
Our Take on XRAY
XRAY ended the fourth quarter on a dismal note, wherein both earnings and revenues missed their respective estimates. Also, a full-year 2025 outlook for declining revenues does not bode well. However, shares were up 1.1% during pre-market trading. The stock plunged 23.9% in the past six months against the industry and the S&P 500’s growth of 0.1% and 7%, respectively.
Per management,Byte, persistent macro pressures and competitive dynamics negatively impacted fourth-quarter and 2024 results. Also, improvements in the fourth quarter included a return to growth in Europe and imaging globally, as well as continued growth of Wellspect Healthcare and SureSmile.
Image Source: Zacks Investment Research
XRAY’s Zacks Rank & Stocks to Consider
XRAY carries a Zacks Rank #4 (Sell) at present.
Some better-ranked stocks in the broader medical space that have announced quarterly results are Cardinal Health, Inc. (CAH - Free Report) , ResMed Inc. (RMD - Free Report) and Boston Scientific Corporation (BSX - Free Report) .
Cardinal Health, carrying a Zacks Rank #2 (Buy), reported second-quarter fiscal 2025 adjusted EPS of $1.93, beating the Zacks Consensus Estimate by 10.3%. Revenues of $55.26 billion outpaced the consensus mark by 0.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cardinal Health has a long-term estimated growth rate of 10.7%. CAH’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 9.6%.
ResMedreported second-quarter fiscal 2025 adjusted EPS of $2.43, beating the Zacks Consensus Estimate by 5.7%. Revenues of $1.28 billion surpassed the Zacks Consensus Estimate by 1.6%. It currently carries a Zacks Rank #2.
ResMedhas a long-term estimated growth rate of 16%. RMD’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.9%.
Boston Scientificreported fourth-quarter 2024 adjusted EPS of 70 cents, beating the Zacks Consensus Estimate by 7.7%. Revenues of $4.56 billion surpassed the Zacks Consensus Estimate by 3.5%. It currently carries a Zacks Rank #2.
Boston Scientifichas a long-term estimated growth rate of 13.3%. BSX’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 8.3%.