Henry Schein, Inc.HSIC is expected to release fourth-quarter 2023 results on Feb 27 before the opening bell.

The company posted adjusted earnings per share (EPS) of $1.32 in the last quarter, which matched the Zacks Consensus Estimate.

The forecast over the trailing four quarters, Henry Schein’s earnings matched estimates twice, surpassed once, and missed once. The average surprise is 0.60%.

The Incumbent Forces

Throughout 2023, Henry Schein faced a substantial year-over-year sales decline in PPE (Personal Protective Equipment) products and COVID-19 test kits, significantly affecting its operations results. The challenging trend likely persisted in the fourth quarter of 2023. Moreover, internal sales likely slowed due to soft market conditions.

Nevertheless, increased customer demand for lower-priced corporate brands, merchandise, and generic products, combined with the expansion of equipment technical service revenues, likely boosted Henry Schein’s profitability. The company appears to have made progress toward achieving 40% of operating income from the sales of high-growth, high-margin products.

Earnings & Stock Performance

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| Henry Schein, Inc. Quote

The Medical business may have fared well in the fourth quarter of 2023, excluding the sales of PPE and COVID-19 test kits. A higher number of sales of lower-priced products, including generics and corporate brands, may have positively impacted the segment’s revenues.

The company fortified its medical business portfolio with the acquisition of Shield Healthcare – a prominent supplier of home care medical products. This strategic addition likely benefited Henry Schein in delivering medical products directly to patients.

Traditional dental equipment sales in North America are anticipated to have been robust in the fourth quarter of 2023, mostly reverting to pre-pandemic levels. The company may have reported strong equipment sales, driven by large DSOs (Dental Service Organizations).

Additionally, steady consumable merchandise volumes in international regions may have positively impacted the company’s fourth-quarter revenues. The company’s dental lab business also strengthened its portfolio by entering into an exclusive distribution agreement in late December 2023.

Market Projection

Henry Schein may have expanded its global market share in the dental specialties segment in the fourth quarter of 2023. The acquisitions of Biotech Dental in France and S.I.N. Implant System in Brazil are expected to have contributed to robust growth in implants and related products.

The Technology and value-added services businesses likely continued their strong sales momentum in the fourth quarter of 2023. The growth may have been propelled by the company’s practice management software solutions and cloud-based offerings.

The Zacks Consensus Estimate for HSIC’s fourth-quarter 2023 revenues is pegged at $3.1 billion, indicating an 8.7% decrease from the year-ago reported figure. The EPS estimate stands at 71 cents, reflecting a year-over-year fall of 41.3%.

Our Insightful Model

Contrary to stocks with a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold), and a positive Earnings ESP, Henry Schein has an Earnings ESP of -5.93%. The company currently carries a Zacks Rank #4 (Sell).

Stocks to Watch

Medical stocks like DaVita DVA with an Earnings ESP of +7.83% and a Zacks Rank #1 should be on the radar as they are poised to announce their first-quarter 2024 results.

With earnings season in full swing, investors are keeping a keen eye on the upcoming earnings releases from some of the major players in the healthcare sector. Let’s dive into some of the key companies set to report their quarterly results and see where the numbers may take us.

United Therapeutics Corporation (UTHR)

United Therapeutics Corporation (UTHR) is scheduled to release its fourth-quarter 2023 results on Feb 21. The company’s expected earnings growth rate of 29.3% in 2023 surpasses the S&P 500’s 14.2%. The last reported quarter saw United Therapeutics deliver an impressive earnings surprise of 10%.

Sarepta Therapeutics, Inc. (SRPT)

Sarepta Therapeutics, Inc. (SRPT) is expected to report its fourth-quarter 2023 results on Feb 27, with an expected earnings growth rate of 18.2% for the year. The company has a track record of delivering an average earnings surprise of 48.7% in the trailing four quarters, making it an intriguing stock to watch.

Market Watch and Expert Insights

Looking for the insider scoop? The Zacks #1 Rank stocks list features some of the most promising healthcare companies worth paying attention to. These stocks have exhibited robust potential for early price pops, and historically, the entire list has outperformed the market by over 2X, delivering an average yearly gain of +24.0% since 1988. It might be wise to take a closer look at these hand-picked 7 stocks.

For those observing the market landscape, these impending earnings releases present a unique opportunity to gain valuable insight into the financial health and future trajectory of these companies. While past performance is not indicative of future results, these impending reports might offer a pivotal look under the hood to uncover where the companies are heading from here.

As an investor, strategically deciphering the implications of these earnings reports might provide a compass for navigating the tumultuous waters of the stock market. Speculations aside, the upcoming quarterly results will undeniably cast a beam of light, revealing the companies’ mettle in the face of ever-changing market dynamics.

So, fasten your seatbelts, it’s going to be an earnings season like no other.

For further insights and informed decision-making, keep an eye on Zacks Investment Research, it could just be the edge you need in these pivotal moments.

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