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Why Barrington Research Cut Its Target Price on Dentsply Sirona

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Barrington Research cut its target price on Dentsply Sirona

On March 27, 2018, Barrington Research reiterated its “buy” rating on Dentsply Sirona (XRAY) while reducing its target price on the stock from $70 to $69. On March 5, 2018, Barrington Research had reiterated its “buy” rating on Dentsply Sirona but cut its target price from $73 to $70. Barrington Research is a Chicago-based investment bank that offers brokerage, research, asset management, and investment banking services. XRAY stock declined by ~2% on March 27, 2018, as compared to its closing price on the previous day. On the same day, the Vanguard Mid-Cap Growth ETF (VOT) fell 1.9%. XRAY makes up 0.64% of VOT’s total portfolio holdings.

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The rationale behind the target price cut

Barrington Research cut its target price on the Dentsply Sirona stock for the second time in March. The recent target price cut followed the announcement of the acquisition of OraMetrix by Dentsply Sirona on March 26, 2018. Though the company has a leading product portfolio, it’s facing challenges. The company outlined a turnaround plan to overcome these challenges. According to Barrington Research, the company has made some moderate adjustments to its quarterly model and stated that the model is now more back-end loaded as compared to the previous model due to the company taking into account the impact of additional costs related to the recent acquisition. Also, these changes were impacted by inventory level changes Dentsply Sirona had announced previously. However, analysts were positive about the company’s ability to overcome the acquisition dilution over the rest of fiscal 2018. On March 5, 2018, Barrington Research cut its target price on XRAY following the company’s quarterly earnings release on March 1, 2018.

In the next article, we’ll discuss Dentsply Sirona’s recent stock price performance.

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