HENRY SCHEIN INC (HSIC) Stock Analysis
HENRY SCHEIN INC (HSIC) Stock Analysis
Overall Grade: F (Concerning)
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HENRY SCHEIN INC faces challenges in financial performance that warrant careful analysis.
Key Metrics:
| Metric | Value | Context |
|---|---|---|
| ROIC | N/A | Below expectations |
| FCF Margin | 4.3% | Cash flow pressure |
| Debt/Equity | 0.9x | Moderate leverage |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
What is HENRY SCHEIN INC's Profitability and ROIC?
HENRY SCHEIN INC's return on invested capital of N/A is below the typical cost of capital. Gross margin of 31.1% with operating margin at 5.0% reflects the company's moderate market position.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Return on Invested Capital (ROIC) | N/A | Red flag | Below cost of capital |
| Gross Margin | 31.1% | Good | Competitive pricing environment |
| Operating Margin | 5.0% | Warning | Moderate operational efficiency |
How Strong is HENRY SCHEIN INC's Cash Flow Quality?
HENRY SCHEIN INC generated $573.0M in free cash flow over the trailing twelve months, representing a 4.3% margin. Cash earnings quality is strong, with operating cash flow exceeding net income by 1.8x.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Free Cash Flow Margin | 4.3% | Warning | Thin cash margins |
| Free Cash Flow (TTM) | $573.0M | Good | Positive cash generation |
| OCF/Net Income | 1.8x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
What is HENRY SCHEIN INC's Financial Health?
HENRY SCHEIN INC's debt-to-equity ratio of 0.9x indicates moderate leverage.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Debt to Equity | 0.9x | Adequate | Moderate leverage |
| Net Cash Position | $-2.9B | Warning | Net debt position |
Is HENRY SCHEIN INC Stock Overvalued or Undervalued?
HENRY SCHEIN INC trades at a P/E of 23.1x, representing a premium to the sector median of N/A. Free cash flow yield of 6.2% offers attractive cash returns.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| P/E Ratio | 23.1x | Adequate | Premium valuation |
| EV/Sales | 0.7x | Excellent | Attractive revenue multiple |
| FCF Yield | 6.2% | Good | Attractive cash return |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Free Cash Flow Margin | 4.3% | Top 50% | - |
| Gross Margin | 31.1% | Bottom 50% | 1.0x below |
| Operating Margin | 5.0% | Bottom 50% | 0.8x below |
| P/E Ratio | 23.1x | N/A | - |
Rating Thresholds
Free Cash Flow Margin
The percentage of revenue converted to free cash flow. Higher margins indicate stronger cash generation and business quality.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Strong cash generation, high-quality business |
| Good | 10% - 20% | Healthy cash conversion |
| Adequate | 5% - 10% | Moderate cash generation |
| Warning | 0% - 5% | Thin cash margins, capital intensive |
| Red flag | < 0% | Cash burn, potential liquidity concerns |
Current: 4.3% (Warning - Top 50% of sector (median: 0.0%))
Gross Margin
Revenue minus cost of goods sold as a percentage. Higher gross margins indicate pricing power and competitive advantage.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 50% | Strong pricing power and competitive moat |
| Good | 30% - 50% | Healthy margins, differentiated product |
| Adequate | 20% - 30% | Moderate margins, competitive industry |
| Warning | 10% - 20% | Thin margins, commodity-like business |
| Red flag | < 10% | Very thin margins, structural challenges |
Current: 31.1% (Good - Bottom 50% of sector (median: 31.2%))
Debt to Equity Ratio
Total debt divided by shareholders' equity. Lower ratios indicate more conservative financing and reduced financial risk.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 0.3x | Conservative leverage, strong balance sheet |
| Good | 0.3x - 0.7x | Moderate leverage, healthy financial position |
| Adequate | 0.7x - 1.5x | Elevated leverage, monitor closely |
| Warning | 1.5x - 3.0x | High leverage, increased financial risk |
| Red flag | > 3.0x | Excessive leverage, potential distress risk |
Current: 94.7% (Adequate)
P/E Ratio (Price-to-Earnings)
Stock price divided by earnings per share. Lower P/E may indicate undervaluation, while higher P/E suggests growth expectations.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 15x | Attractively valued, potential opportunity |
| Good | 15x - 25x | Fair value for quality company |
| Adequate | 25x - 35x | Growth premium, justify with earnings growth |
| Warning | 35x - 50x | High expectations priced in |
| Red flag | > 50x or negative | Speculative valuation or losses |
Current: 23.1x (Adequate)
Free Cash Flow Yield
Free cash flow per share divided by stock price. Higher FCF yield indicates better cash return relative to valuation.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 8% | High cash return, potential value opportunity |
| Good | 5% - 8% | Solid cash yield |
| Adequate | 3% - 5% | Moderate cash return |
| Warning | 1% - 3% | Low cash yield, growth expectations |
| Red flag | < 1% | Minimal cash return to shareholders |
Current: 6.2% (Good)
Frequently Asked Questions
Q: What is HENRY SCHEIN INC's Return on Invested Capital (ROIC)?
HENRY SCHEIN INC (HSIC) has a trailing twelve-month Return on Invested Capital (ROIC) of N/A. This compares below the sector median of 4.3%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is HENRY SCHEIN INC's Free Cash Flow Margin?
HENRY SCHEIN INC (HSIC) has a free cash flow margin of 4.3%, generating $573.0 million in free cash flow over the trailing twelve months. A thin FCF margin may indicate heavy reinvestment or operational challenges.
Q: Is HENRY SCHEIN INC stock overvalued or undervalued?
HENRY SCHEIN INC (HSIC) trades at a P/E ratio of 23.1x, which is above the sector median of N/A. The EV/Sales multiple is 0.7x. Free cash flow yield is 6.2%, which represents an attractive cash return to investors.
Q: How much debt does HENRY SCHEIN INC have?
HENRY SCHEIN INC (HSIC) has a debt-to-equity ratio of 0.9x with total debt of $3.1 billion. Net debt position is $2.9 billion.
Q: What is HENRY SCHEIN INC's revenue and earnings growth?
HENRY SCHEIN INC (HSIC) grew revenue by 4.0% year-over-year. Earnings per share increased by 7.2% compared to the prior year. Modest growth indicates a mature business with stable demand.
Q: Is HENRY SCHEIN INC buying back stock?
HENRY SCHEIN INC (HSIC) repurchased $456.0 million of stock over the trailing twelve months. This represents a buyback yield of 5.0%.
Q: How does HENRY SCHEIN INC compare to competitors in Other?
Compared to other companies in Other, HENRY SCHEIN INC (HSIC) shows: ROIC of N/A is below the sector median of 4.3% (NaNx median). FCF margin of 4.3% exceeds the sector median of 0.0% (Top 36% of sector). Gross margin at 31.1% is 0 percentage points lower than sector peers. These rankings are based on MetricDuck's analysis of all Other companies with available SEC filings.
Q: What warning signs should I watch for with HENRY SCHEIN INC?
Investors in HENRY SCHEIN INC (HSIC) should monitor these potential warning signs: 1) FCF margin is thin at 4.3%, leaving limited buffer for economic downturns. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-11-04. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
This analysis is for informational purposes only and does not constitute investment advice.