On Thursday, Needham, a notable investment firm, adjusted its outlook on DENTSPLY SIRONA (NASDAQ:XRAY), a dental equipment and supplies manufacturer. The firm reduced the price target on the company's stock to $23.00, down from the previous target of $29.00. Despite this change, Needham continues to endorse the stock with a Buy rating.
The decision follows DENTSPLY SIRONA's recent third-quarter results for 2024, which aligned with the company's prior announcements. However, the company also revised its financial guidance for the year downward. This revision was attributed to the suspension of Byte, its direct-to-consumer orthodontics business, and a general decline in demand for dental equipment.
DENTSPLY SIRONA reported that patient traffic in its primary markets, the United States and Germany, remained consistent year-over-year, though there was a noticeable slowdown in Japan and China. The company's management has indicated that it will provide updates regarding its 2026 financial targets during the fourth-quarter earnings call. This future discussion is expected to offer more details on the outlook for Byte.
Needham's adjustment of the price target to $23 from the previous $29 reflects a recalibration of estimates and the application of a lower multiple. This change in valuation comes in the wake of the company's latest financial performance and market challenges.
In other recent news, dental equipment maker DENTSPLY SIRONA has been the subject of several analyst adjustments. Leerink Partners lowered their price target for DENTSPLY SIRONA from $32 to $21 and shifted their rating to Market Perform from Outperform, citing uncertainties affecting the company's growth prospects. However, despite the suspension of sales and marketing for Byte, a clear aligner product, Leerink maintained their Outperform rating with a consistent price target of $32.
Stifel sustained their Hold rating on DENTSPLY SIRONA shares, despite projecting modest revenue growth for the company in 2025. Piper Sandler and Baird also maintained their neutral stances, with respective price targets of $32.00 and $31.00, expressing concerns about the company's market pressures.
DENTSPLY SIRONA reported a 4.2% decline in its second-quarter revenue to $984 million, primarily due to a weaker performance in the Connected Technology Solutions segment. However, the company's full-year net sales are projected to be between $3.86 billion to $3.90 billion, with adjusted earnings per share (EPS) expected to be in the range of $1.96 to $2.02.
InvestingPro Insights
Despite Needham's reduced price target, DENTSPLY SIRONA (NASDAQ:XRAY) presents some interesting financial metrics and potential for investors, according to InvestingPro data. The company's market capitalization stands at $3.6 billion, with a dividend yield of 2.67% as of the last twelve months. This dividend is particularly noteworthy given two InvestingPro Tips: DENTSPLY SIRONA has maintained dividend payments for 31 consecutive years and has raised its dividend for 5 consecutive years, demonstrating a strong commitment to shareholder returns.
While the company's recent performance has been challenging, as reflected in the article's mention of revised financial guidance, InvestingPro data shows a Price to Book ratio of 1.59, suggesting the stock might be undervalued relative to its assets. This aligns with another InvestingPro Tip indicating that the stock is trading near its 52-week low, which could present a potential entry point for long-term investors.
It's worth noting that InvestingPro offers 8 additional tips for DENTSPLY SIRONA, providing a more comprehensive analysis for investors considering this stock. These insights could be particularly valuable given the company's upcoming earnings report and the anticipated discussion of its 2026 financial targets.
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