The dental industry is expected to grow by 64% over the next decade, making it an industry with explosive growth potential. That said, what are the best dental stocks to buy now? Check out the list we made for you below.
Best Dental Stocks
The Procter & Gamble Company (NYSE: PG)
Of all the sub-sectors in the healthcare industry, dentistry is ranked highly in terms of necessity, especially because dental health directly correlates to overall health and well-being.
This is why the first dental stock on this list is The Procter & Gamble Company.
Procter & Gamble is a Fortune 500 American multinational consumer goods corporation founded in 1837.
P&G is also the world’s largest producer of household and personal products, with over 500 brands in 180 countries.
Some of these products include toothpaste, toothbrushes, oral care vitamins, and mouthwash, which is why PG is included on this list.
Procter & Gamble also deals with fabric care, home care, baby care, feminine care, family care, grooming, personal health care, hair care, plus skin and personal care.
With this diverse product list, P&G isn’t a pure-play dental stock but appears to promise a bright long-term outlook.
One of the contributing factors to its potential long-term success is its market share.
P&G leads the industry in terms of market share even when competing amongst the likes of Johnson & Johnson, Church and Dwight, Reckitt Benckiser, and Kimberly-Clark.
A good investor also has to look out for cash flow. The investors who trusted P&G last year received huge returns because of cash flow.
This was because, as of December 2022, P&G was already on track to convert 90% of its earnings into free cash flow.
The cash flow and market share “pros” greatly outweigh P&G’s slow growth and falling profit margins.
With the highlighted advantages and disadvantages, a $330 billion market cap, and an average trading volume of 6,749,126, Procter & Gamble strikes a fine balance between growth and income.
Patterson Companies (NASDAQ: PDCO)
Patterson Companies is one of the longest-running giants in the dental health space after its establishment in 1877.
Although its roots are firmly planted in Minnesota, Patterson Companies have since expanded its dental services and technologies distribution to North America, Europe, the Middle East, Africa, and Asia Pacific.
Patterson currently operates two divisions: Patterson Dental and Animal Health.
The company has an extensive list of products, including dental supplies, equipment, technology, and software; animal health products, such as vaccines, medicines, and other supplies; and office supplies.
Even with Patterson Companies’ multi-continental reach, the stock isn’t widely known.
Yet, during the tail-end of 2022, the PDCO stock saw a double-digit share price rise of over 10%.
If you’re looking to invest in Patterson right now, you can get it at a relatively low price of $30.11.
Although PDCO is a mid-cap stock, it has high coverage from analysts.
Most of these analysts predict a 10% over the next two years. It also looks like higher cash flow could be on the cards for the stock.
Currently, there’s a gradual recovery in the dental market and rebounding dental equipment business (especially in North America), supported by increased technology marketing/promotional activities.
This recovery process should favor the Patterson Companies.
The company’s management disclosed how the sales went up by 0.3% in the third fiscal quarter of fiscal 2022.
Throughout the Dental segment, the company’s field sales, service, and support teams remain committed to delivering value to its customers and business partners, thereby driving solid operational excellence.
With a market cap of $2.8 billion, an average trading volume of 631,045, and a management team with a strong track record, PDCO is a fantastic investment.
Another critical factor to consider is the other sector of PDCO’s business.
The Animal Health division of Patterson Companies is a significant long-term growth engine.
The segment experienced growth of 5.6% in the second quarter of fiscal 2022, driven mostly by strong internal sales growth of more than 8%.
Henry Schein Inc (NASDAQ: HSIC)
According to many statistics, the global dental market is expected to grow at a 7.4% CAGR to $63.93 billion by 2029.
The projected positive growth stems from how the masses view dental services as a necessity.
This perspective has allowed the industry and its companies to become recession-resistant with steady, predictable revenue streams.
One of the companies that perfectly embodies the recession-resistant industry is Henry Schein Inc.
Henry Schein was founded in 1932 by Henry Schein, a Polish immigrant.
The company is a Fortune 500 company and one of the largest providers of healthcare products and services to office-based dental, animal health, and medical practitioners.
HSIC has the most diverse segments on this list. It provides its products and services through Dental Health, Healthcare Distribution, and Technology & Value-Added Services.
At first glance, the three segments may seem completely different, but any potential investor should understand there’s a synergy that significantly increases the company’s demand.
At a prestigious orthodontist conference last year, the company displayed several products that cut across its segments.
This display featured in-booth demonstrations of its Carriere Motion 3D Class II appliance, Carriere Motion 3D Class III Appliance, and Carriere SLX 3D Self-Ligating Bracket System with M-Series & Expansion Wires and Minimum Touch Orthodontics treatment philosophy.
The display highlighted how it’s possible to have simple-to-use, minimally invasive appliances that provide enhanced aligner treatment and reduced patient time.
These efficient and effective products could help Henry Schein’s sales skyrocket.
This is an exciting prospect considering the company’s total net sales for the first nine months of 2022 was $9.3 billion, an increase of 2.3% compared with the first nine months of 2021.
With such a trend, you could also expect great profits from HSIC in the first nine months of 2023.
You can get in on the action right now at $86.74.
The numbers also show Henry Schein’s large market presence. HSIC’s market cap stands at $11bn, so you know it’s less risky to invest than a host of other dental stocks.
The stock also has an average trading volume of 944,755.
Dentsply Sirona (NASDAQ: XRAY)
The dental industry has seen rapid growth in recent years. More companies are being driven by technological advancements, increasing demand for preventive care, and higher standards of care.
If any company ticks all three boxes, it’s Dentsply Sirona.
Since its establishment in 1899, Dentsply Sirona has been the frontrunner of groundbreaking research and development in the dental industry.
The company’s latest and perhaps most effective innovation to date involves collaboration with Google’s parent company, Alphabet.
During a virtual event almost 11 months ago, XRAY unveiled DS Core.
According to Dentsply Sirona, DS Core is the gateway to the digital universe of Dentsply Sirona solutions, built to empower a dental practitioner’s growth by offering a more integrated practice.
By connecting Dentsply Sirona products, DS Core turns gathered data into knowledge.
The company also mentioned how practitioners could keep all patient records in one platform that can be accessed through a web browser anywhere, at any time.
To completely solidify its cloud-based solution approach, the company also introduced DS Core Create, a tool for dental practitioners to gain access to high-quality expert designs, and DS Core Care, a comprehensive, integrated, and easy-to-understand equipment service and support solution.
XRAY’s approach to adopting technology into its products has favored its shareholders, and you could be next if you purchase it at $38.00 right now.
It’s worth noting the stock gained 41% in the last three months, and its Earnings Per Share (EPS) are expected to grow at 9% over the next five years.
XRAY also has a market cap of $8bn and an average trading volume of 2,087,581.
Align Technology (NASDAQ: ALGN)
If you’re looking for rapid growth in a stock, you could consider one of the most popular companies in the dental industry.
Align Technology is a medical device company focused on transforming lives through innovative products such as Invisalign clear aligners and iTero intraoral scanners.
The company’s flagship product, Invisalign, is arguably one of North America’s most popular dental products.
Due to Align Technology’s amazing marketing efforts, their core product is quickly spreading into Latin America and Europe.
According to Orthodontics Limited, over the last few years, Invisalign has served over 1.5 million customers, with a large number of those being adults (18 and older).
With one out of every five orthodontic patients in their adult years, a discrete and pain-free aligning option is essential.
The rise of Invisalign as the best correction method for dental practitioners began two decades ago.
But, the beginning of its amazing stock performance started in 2020. However, 2021’s net income growth seems weak in comparison.
In the last five years, Align’s yearly net income has grown by 234%, and there are no indications that the upward trend is slowing down and no reason to think that it will any time soon.
Are Dental Stocks a Good Investment?
Dental stocks are a worthwhile option for investors looking for a potential source of long-term capital appreciation.
The industry has experienced continuous growth in the past few years due to an increasing population and an increasing demand for dental procedures.
This follows the rise of social media influencers, many of whom are inspiring everyday people to invest in their looks and dentition.
The demand for dental services is expected to increase as people become more aware of the importance of oral health.
Dental procedures, such as implants, crowns, whitening, and braces, are becoming more popular and are now being used to improve oral health and aesthetics.
Furthermore, the increasing prevalence of dental insurance makes dental care more accessible to the masses, thus driving up demand for dental services.
In addition, there is growing demand for dental products such as toothpaste, mouthwash, and toothbrushes.
As these products’ popularity increases, so does the demand for the stocks of companies that produce them.
This, in turn, can lead to higher returns for investors.
On top of this, the industry is relatively immune to economic downturns, as dental procedures are necessary to maintain good oral health.
This means that even during recessions, people will continue to demand dental services, and the industry will remain stable.
Who Is The Largest Dental Supplier?
As things stand, Henry Schein Dental is North America’s largest dental supply company.
What Companies Make Dental Equipment?
There are a ton of companies that manufacture dental equipment, many of which are listed above. They include Henry Schein, Patterson, and Align Technologies.
Is Dental Business Profitable?
The average dental practice can generate roughly $900,000 annually with 30-40% profit margins.