On Wednesday, Needham, a financial services firm, adjusted the price target for DENTSPLY SIRONA (NASDAQ: NASDAQ:XRAY), a dental equipment maker, to $34 from the previous target of $36. Despite the reduction, Needham continues to endorse the stock with a Buy rating. This change comes after the company reported its second-quarter earnings for 2024, which slightly fell short of the market consensus.
DENTSPLY SIRONA's second-quarter revenue and earnings per share (EPS) did not meet the expectations set by analysts. The dental market is expected to remain challenging in the second half of 2024. Nevertheless, there is an anticipation of margin improvement starting in the fourth quarter of 2024 as the company's cost reduction initiatives are predicted to positively impact the profit and loss statement.
The company's management remains optimistic about the future, despite the recent weaker-than-expected macroeconomic trends. They maintain confidence in achieving an EPS of $3 by 2026, bolstered by a new restructuring program. This long-term outlook is a key factor in Needham's decision to reiterate its Buy rating for DENTSPLY SIRONA.
The revised price target of $34 reflects Needham's updated estimates, which have been adjusted in light of the company's recent performance and market conditions. DENTSPLY SIRONA's EPS growth outlook is still positive, according to Needham, even with the current constraints faced by the dental market.
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