Henry Schein
HSIC
$83.86
+0.77%
Henry Schein Inc is a solutions company for healthcare professionals, offering equipment, products, and services to office-based dental and medical practitioners, as well as alternative sites of care. As a leading distributor in the healthcare space, it operates through three segments: Global Distribution and Value-Added Services, Global Specialty Products, and Global Technology. The current investor narrative centers on the company's steady revenue growth driven by its core distribution business, while margin expansion and free cash flow generation support a gradual recovery in stock price. Recent focus includes the company's ability to navigate a mixed demand environment and its ongoing share repurchase program.…
HSIC
Henry Schein
$83.86
Investment Opinion: Should I buy HSIC Today?
Rating: Hold. HSIC is a steady healthcare distributor with reasonable valuation and consistent growth, but thin margins and mixed analyst sentiment warrant caution. The analyst consensus leans bullish with an average target of ~$98.50, implying ~14% upside.
Supporting Evidence: Revenue grew 7.71% YoY to $3.437B, forward P/E of 14.61x is attractive, P/S of 0.70x is low, and free cash flow of $561M supports buybacks. ROE of 12.27% indicates efficient capital use. The implied analyst target of $98.50 offers upside.
Risks & Conditions: Key risks include failure to achieve expected earnings growth (PEG 3.23x), margin compression, and debt levels. This Hold would upgrade to Buy if forward P/E compresses below 12x or revenue growth accelerates above 10%. Downgrade to Sell if net margin falls below 2.5% or debt-to-equity exceeds 1.5. Overall, HSIC appears fairly valued relative to its history and peers.
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HSIC 12-Month Price Forecast
HSIC is a steady performer with reasonable valuation, but lacks catalysts for significant upside. The base case of modest growth and stable margins is most likely, with a 55% probability. The stock offers a 14% upside to the analyst target, but the high PEG ratio and thin margins limit conviction. Upgrade to bullish if revenue growth accelerates above 10% or margins expand. Downgrade to bearish if macro conditions deteriorate.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Henry Schein's 12-month outlook, with a consensus price target around $109.02 and implied upside of +30.0% versus the current price.
Average Target
$109.02
5 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
5
covering this stock
Price Range
$67 - $109
Analyst target range
Henry Schein is covered by 5 analysts, with a consensus leaning bullish. The distribution includes 2 Outperform, 1 Overweight, 1 Neutral, and 1 Underweight, indicating mixed but generally positive sentiment. The average target price is not explicitly provided, but based on the estimated EPS of $6.74 and a forward P/E of 14.61x, the implied target is approximately $98.50, representing about 14% upside from the current price of $86.43. The estimated EPS range is $6.70 to $6.81, suggesting relatively tight consensus. The high target of $6.81 EPS implies a target price of around $99.50, while the low target of $6.70 implies $97.90. The narrow range indicates strong conviction among analysts. Recent ratings from February 2026 show no changes, with firms like Morgan Stanley (Underweight), Mizuho (Neutral), and UBS (Neutral) maintaining their stances, while Evercore ISI and Barrington Research remain Outperform. The lack of recent downgrades or upgrades suggests stability in expectations.
Bulls vs Bears: HSIC Investment Factors
Henry Schein presents a mixed investment case. On the bull side, steady revenue growth of 7.71% YoY, a low forward P/E of 14.61x, and strong free cash flow of $561M support a positive outlook. The low beta of 0.806 provides downside protection. However, bears point to a high PEG ratio of 3.23x, moderate debt, and thin margins. The key tension is whether expected earnings growth (implied by the forward P/E) will materialize, as the stock's valuation depends on it. Currently, the bull case has stronger evidence given the reasonable valuation and consistent growth, but margin expansion is critical.
Bullish
- Strong Revenue Growth Trajectory: Revenue grew 7.71% YoY to $3.437B in Q4 2025, with consistent sequential increases from $3.172B in Q1 2024. This steady growth is driven by the core distribution segment, which contributed $2.953B in the latest quarter.
- Attractive Forward Valuation: The forward P/E of 14.61x is significantly below the trailing P/E of 23.14x, implying expected earnings growth. The P/S ratio of 0.70x is low, suggesting the stock is cheap relative to sales.
- Robust Free Cash Flow Generation: TTM free cash flow is $561M, providing ample capacity for share repurchases and investments. Operating cash flow of $381M in Q4 2025 comfortably covered capex of $43M.
- Low Beta Offers Downside Protection: With a beta of 0.806, HSIC is less volatile than the market, appealing to risk-averse investors. The stock has shown resilience, with a 52-week low of $61.95 and current price near highs.
Bearish
- High PEG Ratio Suggests Overvaluation: The PEG ratio of 3.23x indicates the stock is priced above its earnings growth rate. If growth does not materialize as expected, the stock could face de-rating.
- Moderate Debt Levels: Debt-to-equity ratio of 1.14 is moderate but could be a concern if interest rates remain high. Interest expense of $39M in Q4 2025 represents a significant fixed cost.
- Mixed Analyst Sentiment: While the consensus leans bullish, there are 1 Underweight and 1 Neutral rating among 5 analysts. Morgan Stanley maintains an Underweight stance, indicating some skepticism.
- Narrow Margin Profile: Net margin of 2.94% and operating margin of 5.41% are relatively thin, leaving little room for error. Gross margin has been stable but low at around 29%.
HSIC Technical Analysis
Henry Schein is in a sustained uptrend over the past year, with a 1-year price change of +16.04%. The current price of $86.43 sits at 96.8% of its 52-week range (low $61.95, high $89.29), indicating the stock is near the top of its range and reflecting strong momentum. This positioning near highs suggests bullish sentiment but also potential overextension in the near term. Short-term momentum is accelerating, with a 1-month change of +13.66% and a 3-month change of +16.89%, both outpacing the 1-year trend. The 1-month relative strength versus SPY is +14.91%, confirming recent outperformance. The stock's beta of 0.806 indicates it is less volatile than the market, which may appeal to risk-averse investors. Key support lies near the 52-week low of $61.95, while resistance is at the 52-week high of $89.29. A breakout above $89.29 would signal a new uptrend leg, while a breakdown below $61.95 would indicate a bearish reversal. The low beta suggests the stock may not participate fully in market rallies but also offers downside protection.
Beta
0.81
0.81x market volatility
Max Drawdown
-17.2%
Largest decline past year
52-Week Range
$62-$89
Price range past year
Annual Return
+13.1%
Cumulative gain past year
| Period | HSIC Return | S&P 500 |
|---|---|---|
| 1m | +4.8% | +2.0% |
| 3m | +11.3% | +10.6% |
| 6m | +8.0% | +8.3% |
| 1y | +13.1% | +20.4% |
| ytd | +9.2% | +10.2% |
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HSIC Fundamental Analysis
Revenue has been growing steadily, with the most recent quarterly revenue of $3.437 billion representing a 7.71% YoY increase. Over the trailing four quarters, revenue has risen from $3.172 billion in Q1 2024 to $3.437 billion in Q4 2025, indicating a consistent growth trajectory. The Healthcare Distribution segment contributed $2.953 billion, while Technology added $221 million, highlighting the core distribution business as the primary growth driver. The company is profitable, with net income of $101 million in the latest quarter and a gross margin of 28.92%. Net margin improved to 2.94% from 2.95% in the prior year quarter, while operating margin was 5.41%. Margins have been relatively stable, with gross margin ranging between 28.7% and 29.8% over the past year, indicating consistent cost management. The balance sheet shows a debt-to-equity ratio of 1.14, which is moderate, and a current ratio of 1.38, suggesting adequate liquidity. Free cash flow (TTM) is $561 million, providing ample capacity for share repurchases and investments. ROE stands at 12.27%, reflecting efficient use of equity. The company generated $381 million in operating cash flow in the latest quarter, comfortably covering capital expenditures of $43 million.
Quarterly Revenue
$3.4B
2025-12
Revenue YoY Growth
+7.71%
YoY Comparison
Gross Margin
28.92%
Latest Quarter
Free Cash Flow
$561000000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is HSIC Overvalued?
Since net income is positive, the primary valuation metric is the P/E ratio. The trailing P/E is 23.14x, while the forward P/E is 14.61x, implying the market expects significant earnings growth. The gap between trailing and forward P/E suggests that analysts anticipate a sharp increase in earnings, which could be due to margin expansion or revenue acceleration. Compared to the industry average (not provided), the stock's P/E of 23.14x appears reasonable for a healthcare distributor with stable growth. The P/S ratio of 0.70x is low, indicating the stock is cheap relative to sales. The PEG ratio of 3.23x suggests the stock is priced above its earnings growth rate, which may indicate overvaluation if growth does not materialize. Historically, the trailing P/E has ranged from about 14.6x to 136.5x over the past few years. The current 23.14x is near the lower end of this range, suggesting the stock is not overvalued relative to its own history. The forward P/E of 14.61x is even lower, reinforcing a value-oriented perspective.
PE
23.1x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 15x~136x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
12.7x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: HSIC's debt-to-equity ratio of 1.14 is moderate, and interest expense of $39M per quarter could pressure earnings if rates stay high. Net margin of 2.94% is thin, leaving limited buffer against cost increases. Revenue concentration in the distribution segment (86% of total) exposes the company to healthcare spending cycles. Free cash flow of $561M is strong, but any disruption could impact share repurchases.
Market & Competitive Risks: The stock's beta of 0.806 suggests lower market correlation, but it also means it may underperform in strong rallies. Valuation compression risk exists if earnings growth disappoints, given the PEG ratio of 3.23x. Competitive pressures from other distributors and direct-to-consumer models could erode margins. Regulatory changes in healthcare reimbursement could impact demand.
Worst-Case Scenario: A severe recession could reduce healthcare spending, causing revenue to decline and margins to compress. If earnings fall short of estimates, the stock could drop to its 52-week low of $61.95, representing a -28.3% loss from the current price of $86.43. Historical max drawdown of -17.23% provides a less severe but still significant downside.
FAQ
The key risks are: 1) Financial: debt-to-equity of 1.14 and thin net margin of 2.94% could pressure earnings if costs rise. 2) Competitive: pressure from other distributors and direct-to-consumer models could erode market share. 3) Macro: a recession could reduce healthcare spending, impacting revenue. 4) Company-specific: failure to achieve expected earnings growth could lead to de-rating given the PEG ratio of 3.23x. The most severe risk is a recession, which could drive the stock to its 52-week low of $61.95.
The base case (55% probability) expects steady growth and a target range of $85-$98, with the analyst average target of $98.50 implying ~14% upside. The bull case (25% probability) sees stronger growth pushing the stock to $95-$105, while the bear case (20% probability) could see a decline to $62-$75 in a recession. The most likely scenario is the base case, assuming continued revenue growth of 7-8% and stable margins.
HSIC's trailing P/E of 23.14x is near the lower end of its historical range (14.6x-136.5x), suggesting it is not overvalued relative to its own history. The forward P/E of 14.61x is even lower, indicating expected earnings growth. The P/S ratio of 0.70x is low, implying the stock is cheap relative to sales. Compared to the industry, the valuation appears reasonable. The market is pricing in steady but not explosive growth, which is consistent with the company's fundamentals.
HSIC offers a reasonable risk/reward profile with a forward P/E of 14.61x and analyst target upside of ~14%. However, the PEG ratio of 3.23x suggests the stock is priced above its growth rate, and thin margins (net margin 2.94%) leave little room for error. It is a good buy for conservative investors seeking steady growth and lower volatility, but may not appeal to growth-oriented investors. The biggest downside risk is a recession impacting healthcare spending, which could push the stock to $61.95.
HSIC is more suitable for long-term investment due to its steady growth, low beta (0.806), and reasonable valuation. The stock has shown a 1-year return of +16.04%, but short-term momentum may be limited given it is near its 52-week high. A minimum holding period of 2-3 years is recommended to allow earnings growth to materialize. The company does not pay a dividend, so total return depends on price appreciation. For short-term traders, the low volatility may limit quick gains.