Henry Schein, Inc. HSIC is well-poised to grow in the coming quarters due to its scale in dental and medical distribution. The company’s revenue expansion has been consistently supported by niche acquisitions and partnerships. The rising adoption of digital imaging and chairside workflows backs Henry Schein’s global digital dentistry push and can drive continued attachment of equipment, service and supplies. Yet, headwinds from macroeconomic factors and a debt-heavy balance sheet raise concerns.
Over the past year, this Zacks Rank #3 (Hold) stock has climbed 5.2% compared with the 3.3% growth of the industry and the 31.4% rise of the S&P 500 composite.
The leading distributor of healthcare products and services has a market capitalization of $8.42 billion. The company’s earnings are expected to rise 7% in 2026 compared with the industry’s 5.1% growth. In the trailing four quarters, the company delivered an average earnings surprise of 3.74%.
Let’s delve deeper.
HSIC’s Tailwinds
Widespread Network and Channel Mix: Henry Schein’s distribution footprint supports broad customer coverage and operating efficiency across dental and medical markets. Apart from North America, the company has a presence in Australia and New Zealand, as well as in emerging nations like China, Brazil, Israel, the Czech Republic and Poland. In 2025, it also expanded its wide range of solutions and services in the Hawaiian Islands through the acquisition of R. Weinstein, Inc. In the first quarter of 2026, Global Distribution and Value-Added Services generated $2.84 billion of net sales, up 2.5% year over year. Management reaffirmed 2026 total sales growth guidance of about 3% to 5%, which keeps the focus on leveraging scale, service levels and supplier relationships to gain share over time.
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Expansion Through Acquisitions, Partnerships and Value Creation: Henry Schein’s acquisition strategy is to pursue targets that add product capabilities and expand its access to faster-growing categories. In first-quarter 2026, acquisitions contributed 0.7% to total net sales growth. The company also acquired a controlling interest in its S.I.N. distributor in the United States to enhance its position in the value implant market and support its business integration strategy.
In 2025, Henry Schein expanded its agreement with vVARDIS to become the exclusive U.S. distributor of the drill-free Curodont Repair Fluoride Plus product across all dental market segments. The company has also been investing in technology partnerships, including its collaboration with Amazon Web Services to integrate generative AI across the Henry Schein One ecosystem, and launched LinkIt to improve digital workflow connectivity for Dentrix users.
Alongside these growth initiatives, management is advancing its value creation program, recording $12 million of restructuring expense in first-quarter 2026 as the company executes on its operational plan.
Dental Business Trends Seem Favorable for the Long Term: As dentistry adopts digital imaging and chairside workflows, Henry Schein’s efforts to expand digital dentistry globally can support continued attachment of equipment, service and supplies. The company sells its consumable merchandise and manufactures specialty products in implants, orthodontics and endodontics, which helps it address a wider range of practice needs.
In the first quarter of 2026, Global Dental’s net sales were $1.77 billion, up 3.2% year over year. Management noted that dental practices and DSOs continued to invest in equipment and that the backlog in traditional equipment remained healthy. Dental procedure volumes held steady despite higher merchandise prices, which is consistent with a stable demand environment. In Specialty Products, value implant systems grew in the high single-digits, with improved growth projected in the segment as the year progresses. Premium implants were supported by clinical engagement and new product launches.
What Ails HSIC Stock?
Weak Solvency: Henry Schein ended the first quarter of 2026 with cash and cash equivalents of $138 million, down from $156 million at the end of fourth-quarter 2025. The balance sheet remains levered, with current debt of $1.08 billion and long-term debt of $2.33 billion. At quarter-end, the debt-to-capital ratio was 37.6%, while times interest earned was 4.5X.
Macroeconomic Challenges: The company remains exposed to swings in inflation, foreign exchange and freight costs that can affect demand and profitability. In first-quarter 2026, adjusted operating margin increased 28 basis points year over year to 7.53% on gross margin expansion and mix, yet cash flow was seasonally negative. Henry Schein’s 2026 guidance assumes stable dental and medical end markets and that tariff changes and higher oil prices can be mitigated, but it also signals that product pricing and shipping costs are moving parts.
HSIC Stock Estimate Trend
The Zacks Consensus Estimate for HSIC’s 2026 earnings per share (EPS) has moved to $5.32 from $5.30 in the past 30 days.
The Zacks Consensus Estimate for the company’s 2026 revenues is pegged at $13.72 billion. This suggests a 4.1% rise from the year-ago reported number.
Key Picks
Some better-ranked stocks in the broader medical space are Globus Medical GMED, Align Technology ALGN and Integra LifeSciences IART.
Globus Medical has an earnings yield of 6.1% compared to the industry’s negative 1.1% yield. Its earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 26.3%. GMED shares have rallied 40.2% against the industry’s 7.7% fall over the past year.
GMED sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Align Technology, carrying a Zacks Rank #2 (Buy), has an estimated long-term earnings growth rate of 10.3% for fiscal 2026 compared with the industry’s 9.5% growth. Shares of the company have dropped 11% compared with the industry’s 3.3% rise. ALGN’s earnings outpaced estimates in three of the trailing four quarters and missed on one occasion, the average surprise being 7.8%.
Integra LifeSciences, carrying a Zacks Rank #2, has an earnings yield of 15.7% against the industry’s negative 15.7% yield. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 16.7%. IART shares have rallied 19.9% against the industry’s 7.6% decline over the past year.
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Align Technology, Inc. (ALGN): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).