Editors Note:

Earnings and guidance was good and the post earnings depression is over. Investors bought shares on Monday in a mixed market.


XRAY - Dentsply Sirona Inc - Company Profile

DENTSPLY SIRONA Inc. designs, develops, manufactures, and markets various dental and oral health products, and other consumable healthcare products primarily for the professional dental market worldwide. It operates through two segments, Dental and Healthcare Consumables; and Technologies. The company provides dental consumable products, including endodontic instruments and materials, dental anesthetics, prophylaxis pastes, dental sealants, impression materials, restorative materials, tooth whiteners, and topical fluoride products; and small equipment products comprising dental hand pieces, intraoral curing light systems, dental diagnostic systems, and ultrasonic scalers and polishers. It also offers dental laboratory products, such as dental prosthetics that include artificial teeth, precious metal dental alloys, dental ceramics, and crown and bridge materials. In addition, the company provides dental equipment, such as treatment centers, imaging equipment, and computer aided design and machining systems for dental practitioners and laboratories; and dental implants and related scanning equipment, treatment software, and orthodontic appliances for dental practitioners and specialists, and dental laboratories. Further, it offers healthcare consumable products, such as urology catheters, various surgical products, medical drills, and other non-medical products. DENTSPLY SIRONA Inc. markets and sells its dental products through distributors, dealers, and importers to dentists, dental hygienists, dental assistants, dental laboratories, and dental schools; and urology products directly to patients, as well as through distributors to urologists, urology nurses, and general practitioners. Company description from FinViz.com.

Dentsply reported Q3 earnings of 70 cents that beat estimates for 66 cents. Revenue of $1.01 billion beat estimates for $978.4 million. The company guided for full year earnings of $2.65-$2.70.

Expected earnings Feb 2nd.

The company is being helped by strong demand for dental supplies and the renewal of several major marketing contracts. They extended the existing agreement with Henry Schein Canada through Dec, 31, 2020. The new agreement includes new product lines that did not exist when the original agreement was signed in 2005.

They renewed a market agreement with Pacific Dental Services, which covers 580 centers i 17 states. During the term of the agreement, management expects the number of offices using DentSupply Sirona's technologies to rise over 800.

Shares closed at a new high on Monday. They have been volatile over the last year because of prior changes in marketing agreements where companies leaving the distribution network let inventories decline to zero and did not reorder for the six-month period. That has passed and everything is running smoothly again.

Because their earnings are not until February we have to reach out to April to insure the premium remains inflated with earnings expectations. There is no February option series yet. We can buy all the time we need but we do not have to use it. We will exit before earnings.

Buy Apr $70 call, currently $3.20, initial stop loss $63.50.


No New Bearish Plays