DENTSPLY Acquires Propel Orthodontics for $131M


DENTSPLY SIRONA Inc (XRAY) has acquired Propel Orthodontics for $131 million in cash. DENTSPLY manufactures dental products and technologies primarily for the professional dental market worldwide.

The acquired assets include the VPro device and the Fastrack Mobile App.

Propel Orthodontics manufactures and sells orthodontic devices. It provides in-office and at-home orthodontic accessory devices to orthodontists and their patients.

The buyout of Propel Orthodontics assets will add to DENTSPLY’s Byte and SureSmile offerings. Furthermore, the deal will increase the company’s presence in the growing clear aligner market. (See DENTSPLY SIRONA stock analysis on TipRanks)

On May 6, DENTSPLY reported strong Q1 results. Total revenues came in at $1.03 billion which surpassed the Street’s estimates of $948.7 million and grew 17.5% from the year-ago period. Earnings of $0.72 per share were also above the consensus estimates of $0.56 per share and increased 67.4% year-over-year.

Following the Q1 earnings announcement, H.C. Wainwright analyst Yi Chen reiterated a Hold rating on the stock but increased his price target to $72.00 from $60.00. This implies 8.6% upside potential to current levels.

Chen said, “The COVID-19 pandemic is likely to continue its subsidence in major global markets as COVID-19 vaccines get wider distribution, which should help the company achieve solid growth in 2021 as it implements the strategy of growing revenue and expanding margins.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 5 Buys versus 3 Holds. The average analyst price target of $73.75 implies 11.3% upside potential to current levels. Shares have increased 23.7% over the past six months.

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