/Henry%20Schein%20Inc_%20sign%20outside%20office-by%20JHVEPhoto%20via%20Shutterstock.jpg)
Henry Schein, Inc. (HSIC), headquartered in Melville, New York, provides health care products and services to dental practitioners, laboratories, physician practices, and ambulatory surgery centers, government, institutional health care clinics, and other alternate care clinics. Valued at $9.4 billion by market cap, the company provides shop supplies, as well as dental and medical solutions and services to improve operational success and clinical outcomes.
Shares of this world’s largest health care solutions provider have underperformed the broader market over the past year. HSIC has gained 8.2% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 31%. In 2024, HSIC stock is down marginally, compared to the SPX’s 25.2% rise on a YTD basis.
Narrowing the focus, HSIC’s underperformance is apparent compared to the SPDR S&P Health Care Services ETF (XHS). The exchange-traded fund has gained about 11.8% over the past year. Moreover, the ETF’s 7.4% gains on a YTD basis outshine the stock’s marginal losses over the same time frame.
HSIC's lackluster performance can be linked to a decline in sales of personal protective equipment, especially due to decreased glove pricing, as well as lingering effects from a cyber incident that occurred late last year.
On Nov. 5, HSIC shares closed down more than 4% after reporting its Q3 results. Its adjusted EPS of $1.22 topped Wall Street expectations of $1.16. The company’s revenue was $3.17 billion, missing Wall Street forecasts of $3.24 billion. HSIC expects full-year adjusted EPS to be between $4.74 and $4.82.
For the current fiscal year, ending in December, analysts expect HSIC’s EPS to grow 6.2% to $4.78 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters while missing the forecast on another occasion.
Among the 13 analysts covering HSIC stock, the consensus is a “Moderate Buy.” That’s based on five “Strong Buy” ratings, six “Holds,” one “Moderate Sell,” and one “Strong Sell.”
The configuration is consistent over the past three months.
On Nov. 18, Leerink Partners analyst Michael Cherny maintained a “Hold” rating on HSIC with a $73 price target.
While HSIC currently trades above its mean price target of $74.67, the Street-high price target of $83 suggests an upside potential of 10.5%.
