DENTSPLY SIRONA Inc. Reported A Surprise Loss, And Analysts Have Updated Their Forecasts
Last week, you might have seen that DENTSPLY SIRONA Inc. (NASDAQ:XRAY) released its quarterly result to the market. The early response was not positive, with shares down 4.4% to US$9.46 in the past week. It was a pretty negative result overall, with revenues of US$836m missing analyst predictions by 3.0%. Worse, the business reported a statutory loss of US$0.01 per share, a substantial decline on analyst expectations of a profit. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on DENTSPLY SIRONA after the latest results.
Following last week's earnings report, DENTSPLY SIRONA's 15 analysts are forecasting 2027 revenues to be US$3.54b, approximately in line with the last 12 months. Earnings are expected to improve, with DENTSPLY SIRONA forecast to report a statutory profit of US$0.37 per share. Before this earnings report, the analysts had been forecasting revenues of US$3.61b and earnings per share (EPS) of US$0.66 in 2027. The analysts seem to have become more bearish following the latest results. While there were no changes to revenue forecasts, there was a pretty serious reduction to EPS estimates.
Check out our latest analysis for DENTSPLY SIRONA
It might be a surprise to learn that the consensus price target fell 9.4% to US$11.23, with the analysts clearly linking lower forecast earnings to the performance of the stock price. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic DENTSPLY SIRONA analyst has a price target of US$17.00 per share, while the most pessimistic values it at US$8.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the DENTSPLY SIRONA's past performance and to peers in the same industry. We would also point out that the forecast 0.7% annualised revenue decline to the end of 2027 is better than the historical trend, which saw revenues shrink 3.2% annually over the past five years Compare this against analyst estimates for companies in the broader industry, which suggest that revenues (in aggregate) are expected to grow 7.5% annually. So it's pretty clear that, while it does have declining revenues, the analysts also expect DENTSPLY SIRONA to suffer worse than the wider industry.
The Bottom Line
The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of DENTSPLY SIRONA's future valuation.
With that in mind, we wouldn't be too quick to come to a conclusion on DENTSPLY SIRONA. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for DENTSPLY SIRONA going out to 2028, and you can see them free on our platform here..
You can also view our analysis of DENTSPLY SIRONA's balance sheet, and whether we think DENTSPLY SIRONA is carrying too much debt, for free on our platform here.
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