DENTSPLY SIRONA Inc. XRAY is scheduled to release fourth-quarter 2024 results on Feb. 27, before the opening bell.

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In the last reported quarter, the company’s earnings surpassed the Zacks Consensus Estimate. It delivered an average earnings surprise of 1.13% in the past four quarters.

XRAY’s Q4 Estimates

The Zacks Consensus Estimate for revenues is pegged at $919.4 million. The consensus mark for earnings is pinned at 43 cents per share.

Factors to Note Ahead of XRAY’s Q4 Results

DENTSPLY SIRONA’s Orthodontic and Implant Solutions segment witnessed decline in revenues in the last reported quarter due to Byte, and Implants and Prosthetics’ struggles. The company decided to voluntarily suspend Byte sales, marketing and shipments due to regulatory issues and legislative pressures. For the fourth quarter, XRAY expects organic sales to decline high-single digits, mainly due to Byte’s sales suspension which is likely to result in $40 million revenue loss and weak equipment demand in the United States. The company removed all Byte-related revenues from its forecast, but costs are still likely to have impacted margins as restructuring continues.

SureSmile witnessed growth on a year-on-year basis, performing well in Europe & Rest of World, but faced softer demand in the United States. Implants declined due to macroeconomic pressures and competition. This is likely to have continued in the to-be-reported quarter as well. The company also plans to improve SureSmile’s software and expand its sales efforts.

In the third quarter, XRAY’s Connected Technology Solutions segment’s top-line performance witnessed decline. The company expects further decline in the upcoming quarters. However, CAD/CAM sales grew, driven by strong demand for mills and intraoral scanners, including the launch of Primescan 2. This is likely to have continued in the to-be-reported quarter as well.

In the third quarter, the Essential Dental Solutions (“EDS”) segment saw significant organic growth, mainly due to $20 million in early distributor orders ahead of the U.S. ERP system launch. Growth was also supported by strong performance in China and Canada. Despite challenges in the broader market, EDS remained a strong performer. The company expects the momentum to have continued in the fourth quarter as well.

In the last reported quarter, XRAY launched several new products to boost growth. Primescan 2, a new wireless intraoral scanner, was introduced in September and is powered by DS Core, which have gained 20% more users this quarter. The company also launched the X-Smart Pro+ endo motor in the United States, which performed so well that it met full-year sales goals by the end of third quarter. The Orthophos SL imaging line was expanded into more markets in Europe and Asia-Pacific.

Additionally, the company received regulatory approval for five new products and improved its software platform, DS Core, with more than 85 updates. Looking ahead, the company plans to invest more in SureSmile orthodontics software, DS Core, and other digital tools. XRAY’s new product launches are expected to have supported fourth quarter sales, particularly in CAD/CAM and EDS segments.

The company has lowered its full-year revenue guidance to $3.79-$3.82 billion and now expects an adjusted EBITDA margin of approximately 17.5% (previously >18%). Fourth quarter earnings per share is anticipated in the low-to-mid 40 cents range, indicating weaker sales and ongoing market challenges.

DENTSPLY SIRONA Inc. Price and EPS Surprise

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

What the Zacks Model Unveils for XRAY

Our proven model does not conclusively predict earnings beat for XRAY this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.

XRAY’s Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -2.55%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

XRAY’s Zacks Rank: DENTSPLY SIRONA currently carries a Zacks Rank #4 (Sell).

Stocks to Consider

Here are a few medical stocks worth considering, as these have the right combination of elements to come up with earnings beat this reporting cycle.

Natera NTRA has an Earnings ESP of +61.91% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

NTRA’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 36.37%. The Zacks Consensus Estimate for fourth-quarter EPS implies a rise of 34.4% from the year-ago reported figure.

Masimo MASI currently has an Earnings ESP of +4.05% and a Zacks Rank #2. 

The company is scheduled to release fourth-quarter 2024 results on Feb. 25. Its earnings surpassed estimates in each of the trailing four quarters, the average surprise being 17.10%. The Zacks Consensus Estimate for EPS implies an improvement of 14.4% from the year-ago reported figure.

Maravai LifeSciences MRVI has an Earnings ESP of +10.00% and a Zacks Rank #3 at present. The company is expected to release fourth-quarter 2024 results in February.

MRVI delivered a trailing four-quarter average earnings surprise of 116.67%. The Zacks Consensus Estimate for fourth-quarter EPS implies a decline of 400% from the year-ago reported figure.

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DENTSPLY SIRONA Inc. (XRAY) : Free Stock Analysis Report

Masimo Corporation (MASI) : Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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