Henry Schein Takes Major Stake in eAssist Dental Solutions

Henry Schein (HSIC) has revealed that it has acquired a 70% ownership stake in eAssist Dental Solutions.

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The financial terms of the deal have been kept under wraps. The deal is expected to be modestly dilutive to the company’s financial results in 2021, and to be accretive thereafter.

Henry Schein is a global distributor of health care products and services to office-based dental and medical practitioners, with a presence in 32 countries.

The addition of eAssist will enhance HSIC’s goal of providing best-in-class solutions to help the dental world increase efficiency and profitability. (See HSIC stock analysis on TipRanks)

eAssist Dental Solutions develops virtual dental billing outsourcing services with recorded sales of $31 million in 2020. It uses a mix of technology and human expertise, helping dental practitioners simplify operations, reduce cash flow-related stress, and free up resources to focus on patient care and clinical outcomes.

Henry Schein CEO Stanley M. Bergman commented, “We are delighted to add eAssist to our leading portfolio of value-added services, which will help our customers improve their critical insurance and billing functions so dental teams can focus on delivering quality patient care.”

Stifel Nicolaus analyst Jonathan Block recently maintained a Hold rating and the price target of $77 (2.3% downside potential) on the stock.

Block raised his Q2 EPS estimates from $0.92 to $1 after HSIC’s CEO commented on upbeat business trends and stable margins.

He further added, “The gross margin rebound seen in 1Q21 appears likely to remain intact, with management noting that the margin performance was tied to underlying business trends, rather than PPE sales. Looking forward, management expects gross margin to remain stable, with any margin fluctuation likely tied to operating expenses as certain items (travel, etc.) come back online.”

Overall, the stock has a Moderate Buy consensus rating based on 3 Buys and 3 Holds. The HSIC average analyst price target of $81.83 implies 3.9% upside potential from current levels. Shares of HSIC have jumped 40.8% over the past year.