Nasdaq:HSIC
HENRY SCHEIN INC
A premier global distributor of medical products and services empowering healthcare providers with essential supplies and technology solutions.
Key Metrics
Investment Thesis
Bull Case
HSIC offers attractive exposure to the secular growth trends in healthcare and veterinary sectors, supported by recurring revenue streams from its vast provider network. The company's ability to generate $712M in operating cash flow provides ample liquidity for share repurchases of $850M, signaling confidence in future returns to shareholders. Diversification across medical, dental, and veterinary segments reduces reliance on any single market cycle.
Bear Case
The recent net income contraction from 2022's $566M to 2025's $419M raises concerns about margin pressure or one-time costs impacting profitability. Significant non-cash adjustments of -$187M and large investing cash outflows of $400M suggest heavy capital expenditure or acquisition activity that may not yet translate into proportional earnings growth. High accumulated other comprehensive income loss of -$226M indicates potential volatility in foreign exchange exposures affecting reported equity.
About HENRY SCHEIN INC
Henry Schein Inc. (HSIC) is a leading global medical products distributor serving healthcare professionals, veterinary clinics, and dental practices across North America and Europe. The company distributes essential supplies such as pharmaceuticals, surgical instruments, diagnostic equipment, and dental materials through its diverse network of independent offices. With revenue reaching $13.18B in the latest period, HSIC provides critical infrastructure support to a wide range of medical sectors.
Analysis
Management Discussion
Recent financial performance shows revenue growth to $13.18B, offsetting a slight decline in net income from 2024's $398M to 2025's $419M, though this remains resilient compared to historical peaks. Strong operating cash flow of $712M highlights efficient working capital management, despite significant investing outflows of $400M likely related to strategic acquisitions or infrastructure upgrades. The company maintains a healthy liquidity position with $156M in ending cash against manageable debt levels.
Industry Overview
The global healthcare distribution industry is characterized by consolidation, technological innovation, and increasing demand for specialized medical products. Companies must navigate complex regulatory environments while leveraging data-driven supply chains to meet the growing needs of an aging population and expanding veterinary markets. Competitive dynamics favor players with broad product portfolios and strong relationships with independent healthcare providers.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $12.65B | $12.34B | $12.67B | $13.18B |
| Cost of Revenue | $8.82B | $8.48B | $8.66B | $9.08B |
| Gross Profit | $3.83B | $3.86B | $4.02B | $4.11B |
| Operating Expenses | $3.08B | $3.25B | $3.40B | $3.45B |
| Operating Income | $747.0M | $615.0M | $621.0M | $653.0M |
| G&A | $2.77B | $2.96B | $3.03B | $3.08B |
| Stock-Based Comp | $54.0M | $39.0M | $39.0M | $39.0M |
| D&A | $212.0M | $248.0M | $297.0M | $311.0M |
| Depreciation | $68.0M | $70.0M | $83.0M | $101.0M |
| Amortization | $126.0M | $152.0M | $185.0M | $180.0M |
| Other OpEx | $313.0M | $290.0M | $361.0M | $368.0M |
| Non-Operating Income | $-26.0M | $-73.0M | $-108.0M | $-120.0M |
| Interest Expense | $44.0M | $87.0M | $131.0M | $150.0M |
| Interest Income | $17.0M | $17.0M | $24.0M | $33.0M |
| Pre-Tax Income | $721.0M | $542.0M | $513.0M | $533.0M |
| Income Tax | $170.0M | $120.0M | $128.0M | $126.0M |
| Continuing Ops | $566.0M | $422.0M | $385.0M | $407.0M |
| Discontinued Ops | $0 | $14.0M | $13.0M | $12.0M |
| Net Income | $566.0M | $436.0M | $398.0M | $419.0M |
| Minority Interest | $28.0M | $20.0M | $8.0M | $21.0M |
| Net to Common | $538.0M | $416.0M | $390.0M | $398.0M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $3.99B | $4.49B | $3.98B | $4.46B |
| Accounts Receivable | $1.44B | $1.86B | $1.48B | $1.65B |
| Inventory | $1.96B | $1.81B | $1.81B | $2.00B |
| Prepaid Expenses | $466.0M | $639.0M | $569.0M | $655.0M |
| Other Current Assets | $117.0M | $171.0M | $122.0M | $156.0M |
| Long-Term Assets | $4.62B | $6.08B | $6.24B | $6.75B |
| Intangibles | $587.0M | $916.0M | $1.02B | $1.02B |
| Goodwill | $2.89B | $3.88B | $3.89B | $4.21B |
| Operating Leases | $284.0M | $325.0M | $293.0M | $301.0M |
| Other LT Assets | $855.0M | $969.0M | $1.03B | $1.22B |
| Total Assets | $8.61B | $10.57B | $10.22B | $11.21B |
| Current Liabilities | $2.22B | $2.68B | $2.80B | $3.23B |
| Accounts Payable | $1.00B | $1.02B | $962.0M | $1.15B |
| Current Leases | $73.0M | $80.0M | $75.0M | $78.0M |
| Deferred Revenue | $86.0M | $89.0M | $81.0M | — |
| Other Current Liab | $1.06B | $1.49B | $1.69B | $2.00B |
| Long-Term Liabilities | $1.71B | $2.74B | $2.58B | $3.19B |
| LT Operating Leases | $275.0M | $310.0M | $259.0M | $251.0M |
| Other LT Liab | $1.43B | $2.42B | $2.31B | $2.93B |
| Total Liabilities | $3.94B | $5.42B | $5.38B | $6.42B |
| Shareholders' Equity | $4.67B | $5.15B | $4.84B | $4.79B |
| Paid-In Capital | $0 | $0 | $0 | $177.0M |
| Retained Earnings | $3.68B | $3.86B | $3.77B | $3.29B |
| AOCI | $-233.0M | $-206.0M | $-379.0M | $-226.0M |
| Total L&E | $8.61B | $10.57B | $10.22B | $11.21B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $566.0M | $436.0M | $398.0M | $419.0M |
| Non-Cash Adjustments | $-53.0M | $-114.0M | $916.0M | $-187.0M |
| Working Capital Changes | $89.0M | $178.0M | $-466.0M | $480.0M |
| Cash from Operations | $602.0M | $500.0M | $848.0M | $712.0M |
| Cash from Investing | $-276.0M | $-1.14B | $-430.0M | $-400.0M |
| Debt Issuances | $270.0M | $1.37B | $120.0M | $489.0M |
| Debt Repayments | $59.0M | $468.0M | $318.0M | $44.0M |
| Share Buybacks | $485.0M | $250.0M | $385.0M | $850.0M |
| Cash from Financing | $-315.0M | $701.0M | $-510.0M | $-188.0M |
| FX Effect | $-12.0M | $-12.0M | $43.0M | $-90.0M |
| Net Change in Cash | $-1.0M | $54.0M | $-49.0M | $34.0M |
| Beginning Cash | $118.0M | $117.0M | $171.0M | $122.0M |
| Ending Cash | $117.0M | $171.0M | $122.0M | $156.0M |
Frequently Asked Questions
How does HENRY SCHEIN INC make money?
The company operates primarily through four main segments: Medical Products serving physicians and clinics; Veterinary Products for animal healthcare professionals; Dental Products for dental practitioners; and Consumer Health focusing on over-the-counter items for retail partners. These segments collectively drive the $13.18B revenue base, supported by a robust distribution network and specialized supply chain management.
What are the main risks for HSIC?
Fluctuations in healthcare spending and reimbursement rates could impact the demand for premium products and services. Rising input costs for pharmaceuticals and manufacturing materials may compress gross margins given the competitive nature of distribution. Regulatory changes in drug pricing or supply chain disruptions from international sourcing could significantly affect cost structures. High levels of goodwill ($4.21B) expose the company to potential impairment charges during economic downturns.
What is HSIC's competitive advantage?
HSIC benefits from an extensive direct relationship with over 50,000 healthcare providers, creating high switching costs and deep market penetration. The company leverages advanced data analytics to optimize inventory levels, reducing holding costs while ensuring product availability, evidenced by strong cash flow from operations of $712M. Its diversified revenue streams across medical, dental, and veterinary sectors provide stability against sector-specific downturns.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.