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DENTSPLY (XRAY) Tops Q1 Earnings & Sales, View Positive

DENTSPLY SIRONA Inc. XRAY reported adjusted earnings of 69 cents per share in the first quarter of 2016 which beat the Zacks Consensus Estimate by 6 cents. Earnings improved almost 17% on a year-over-year basis, primarily driven by strong top-line growth and margin expansion.
 

Quarter Details

Net sales increased 17.7% on a year-over-year basis to $772.6 million, surpassing the Zacks Consensus Estimate of $652 million. Excluding precious metals content, sales increased 19.5% from the year-ago quarter to $754.5 million.

Sales (excluding precious metals) of the combined businesses grew 6.5% at constant currency (cc) exchange rates. Excluding a 1.7% benefit from net acquisitions and a 0.7% unfavorable impact from discontinued products, internal sales growth of the combined company was 5.5%.

DENTSPLY’s top-line growth was impacted by approximately 2.6% due to the strengthening of the U.S. dollar.

In the quarter, the U.S. sales rose 16.2% to $279.7 million, while net sales in Europe increased 10.3% to $311.2 million. Sales (excluding precious metals) of the combined businesses grew 8.8% at cc in the U.S., while in Europe, the growth was 3.2%.

Net sales in Rest of World increased 36.2% to $181.7 million. Sales (excluding precious metals) in Rest of World of the combined businesses improved 8.4% at cc.

Post the DENTSPLY-SIRONA merger, the business has been organized into two reporting segments: Dental & Healthcare Consumables and Technologies.

Dental & Healthcare Consumables comprises preventive, restorative, instruments, endodontic, and laboratory dental products, as well as consumable medical device products. Sales increased 1.8% to $488.8 million. At cc, sales of the combined entity inched up 3.9% in the quarter.

Technologies consist of dental implants, CAD/CAM systems, imaging systems, treatment centers and orthodontic products. Net sales increased by 61.1% to $283.8 million. At cc, sales of the combined businesses climbed 9.6% in the quarter.

Guidance

For full-year 2016, DENTSPLY expects revenue growth of 4% to 6% at cc, driven by growth in both of its segments. Adjusted earnings are forecasted in the band of $2.70 to $2.80 per share.

Zacks Rank & Key Picks

Currently, DENTSPLY carries a Zacks Rank #4 (Sell).

Better-ranked stocks in the broader medical sector include C.R. Bard BCR, CONMED Corp CNMD and VWR Corp VWR. All the three stocks carry a Zacks Rank #2 (Buy).

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BARD C R INC (BCR): Free Stock Analysis Report
 
CONMED CORP (CNMD): Free Stock Analysis Report
 
DENTSPLY SIRONA (XRAY): Free Stock Analysis Report
 
VWR CORP (VWR): Free Stock Analysis Report
 
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