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Valued at a market cap of $8.9 billion, Henry Schein, Inc. (HSIC) is a distributor of healthcare products and services, including vaccines, pharmaceuticals, financial services, and equipment. This New York-based company operates through two segments: Health Care Distribution and Technology and Value-Added Services.
Shares of this healthcare products maker have significantly underperformed the broader market over the past 52 weeks. HSIC has declined 8.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 28.3%. In 2024, shares of HSIC dipped 7.8%, compared to SPX’s 17.6% gain on a YTD basis.
Narrowing this focus, HSIC’s underperformance becomes more evident when compared to the S&P Healthcare Services SPDR’s (XHS) nearly 9% gain over the past 52 weeks and 8.8% returns on a YTD basis.
Despite beating earnings estimates, shares of HSIC declined 8.1% on Aug. 6 due to the company lowering its annual profit forecast and revenue growth expectations, citing a slower-than-anticipated recovery from a cyberattack that disrupted its operations. Additionally, the company reported Q2 revenue that fell short of analysts' estimates, exacerbating investor concerns.
For the current fiscal year, ending in December, analysts expect HSIC’s EPS to grow 5.6% year over year to $4.75. The company’s earnings surprise history is mixed. It beat or met the consensus estimates in three of the last four quarters while missing on another occasion.
Among the 13 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on five “Strong Buy” ratings, six “Holds,” one “Moderate Sell,” and one “Strong Sell.”
This configuration is slightly more bullish than three months ago, with four “Strong Buy” ratings on the stock.
On Aug. 7, Baird cut Henry Schein’s price target to $82 but maintained an “Outperform” rating, citing improved gross margins and expected growth in 2025.
The mean price target of $73.33 represents a premium of just 5% to HSIC’s current levels. The street-high price target of $83, implies a potential upside of 18.9% from the current price
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
