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On Tuesday, Mizuho (NYSE:MFG) Securities adjusted its outlook on Henry Schein (NASDAQ:HSIC), a $8.79 billion healthcare provider, by reducing the price target to $76 from the previous $78 while maintaining a Neutral rating on the stock. According to InvestingPro data, nine analysts have recently revised their earnings estimates downward for the upcoming period. Mizuho’s analyst Steven Valiquette revised the firm’s financial model to reflect Henry Schein’s new business segmentation and the initial disclosure of EBIT by segment.
Henry Schein recently participated in an investor conference where the company highlighted several key points. The company’s ’sub-premium’ dental implant franchise is experiencing mid-single-digit growth in Europe and stable volume in the U.S., which management believes is outperforming the overall market growth. With annual revenues of $12.67 billion and an EBITDA of $1.01 billion, the company maintains a strong market position. This success is attributed to general practitioners expanding their services to include implant procedures rather than referring patients to oral surgeons. For deeper insights into Henry Schein’s financial health and growth prospects, check out the comprehensive Pro Research Report available on InvestingPro.
Additionally, management noted that the Medical (TASE:BLWV) segment is benefiting from a strong flu season and a robust home health market. Furthermore, the involvement of private equity firm KKR is expected to not only streamline costs but also potentially enhance sales strategies. The company maintains a healthy financial profile with an InvestingPro Financial Health Score rated as "GOOD" and demonstrates relatively low price volatility with a beta of 0.9.
In light of the company’s new segmentation and updated guidance, Mizuho has made slight adjustments to its earnings per share (EPS) forecasts for Henry Schein. The estimated EPS for 2025 has been lowered from $4.92 to $4.90, primarily due to a change in quarterly projections. The forecast for 2026 has been revised from $5.40 to $5.30. The revised price target of $76 is based on a 14x price-to-earnings (P/E) ratio applied to the slightly reduced 2026 EPS estimate, while the current P/E ratio stands at 22.94x. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading near its Fair Value.
In other recent news, Henry Schein Inc. reported its Q4 2024 earnings, revealing a slight miss in both earnings per share (EPS) and revenue against market forecasts. The company’s EPS was $1.19, below the expected $1.23, while revenue reached $3.19 billion, missing the forecasted $3.35 billion. Despite these results, the company demonstrated a 5.8% year-over-year growth in global sales, with a GAAP operating margin improvement of 358 basis points. Looking ahead, Henry Schein projects total sales growth of 2-4% for 2025, with non-GAAP diluted EPS expected to range between $4.80 and $4.94. In other developments, the company announced a change in its executive team, with James P. Breslawski stepping down as President to become a Senior Advisor in April 2025. Additionally, Henry Schein has undergone a restructuring of its orthodontic business and is addressing challenges in that segment. The company has also made strategic changes to its reportable segments to provide more meaningful information to investors.
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