Sirona Dental Hits New 52-Week High - Analyst Blog

Driven by steady growth impetus, shares of Sirona Dental Systems, Inc. SIRO reached a new 52-week high of $82.15 in mid-day trading on Jun 26. The company's shares closed marginally lower at $82.08 on the same day, translating to a healthy one-year return of 26.0% and a decent year-to-date return of 16.9%.

SIRO has a market cap of $4.7 billion while average volume of shares traded over the last 3 months stands at approximately 0.4 million.

Shares of this global dental technology company have been on the rise since it reported impressive fiscal 2014 second-quarter (ended Mar 31, 2014) results on May 9. The stock climbed 1.2% on the same day, reflecting investors' confidence in the company.

SIRO posted a 6.7% year-over-year improvement in adjusted earnings per share to 80 cents in the most recent quarter. Earnings also edged past the Zacks Consensus Estimate by 2 cents.

Revenues in the quarter grew 5.8% (or 2.9% on a constant currency basis) to $282.7 million, driven by strength across all business segments. SIRO continues to witness strong demand for its Imaging and CAD/CAM products.

For fiscal 2014, SIRO retained its revenues and earnings guidance. The company anticipates adjusted earnings in the range of $3.60 to $3.70 per share, implying a year-over-year growth of 6–9%.  The Zacks Consensus Estimate of $3.67 lies within the guided range.
 
SIRO continues to expect revenue growth in the range of 4–6% in constant currency. The projection assumes 20% constant currency growth in two of the company's major markets, the U.S. and Germany.

Earlier this month, Henry Schein, Inc. HSIC acquired SIRO's direct sales business in France, Sirona Direct. Henry Schein is a global distributor of healthcare products and services with global dental sales of around $5 billion in 2013.

Per the deal, Henry Schein will exclusively promote and distribute SIRO's full line of dental equipment, including the CEREC CAD/CAM system, to practitioners across France. By intensifying its partnership with Henry Schein, SIRO intends to expand its customer base and secure long-term, profitable growth in one of Europe's largest dental markets.

Currently, SIRO carries a Zacks Rank #3 (Hold). Better-ranked stocks in the medical instruments industry include Alphatec Holdings, Inc. ATEC and Luminex Corporation LMNX. Both these stocks sport a Zacks Rank #1 (Strong Buy).