We all love our pets. But today, investors seemingly love medical supplies conglomerate Patterson Companies, which primarily deals with veterinary and dental supplies. The mid-cap company reported stronger-than-expected fourth-quarter results, topping revenue and earnings estimates. 🔺
Adjusted earnings per share of $0.84 on revenues of $1.72 beat the expected $0.84 and $1.66 billion. The company’s cost-reduction efforts and product mix drove adjusted gross margin expansion, and it returned $156.8 million to shareholders in fiscal 2023 through dividends and share buybacks. 🍖
The company’s Dental segment reported $683.5 million in sales. Internal sales rose 8% YoY, broken down as such:
- Internal sales of consumables +0.3% YoY
- Internal sales of consumables (excluding infection control products) +4.4% YoY
- Internal sales of equipment +19.2% YoY
- Internal sales of value-added services +13.4% YoY
Patterson Animal Health sales were $1.03 billion, with internal sales growth of 3.2% YoY:
- Internal sales of consumables +2.4% YoY
- Internal sales of equipment +16.7% YoY
- Internal sales of value-added services +52.6% YoY
Looking ahead, it initiated fiscal 2024 adjusted earnings guidance of $2.45 to $2.55 per share. However, it did not provide a revenue outlook. Executives expect the company’s strong competitive positioning to offset continued inflationary trends and higher interest rates that weigh on costs and demand. 🔮
$PDCO shares rallied 15% on the news as investors appeared optimistic about the future. 👍
