Industry Overview - The Zacks Medical - Dental Supplies industry is experiencing weakness due to rising U.S. tariffs on trading partners, particularly China, which are expected to impact sales through 2025 [1] - Demand for elective procedures in the U.S. is declining, affecting sales across various product lines, including CAD/CAM and imaging products [2] - The global dental industry is projected to reach $610.4 billion with a CAGR of 4.5% from 2023 to 2032, indicating long-term growth potential despite current challenges [2] Major Trends - The aging population in the U.S. is a significant driver for the dental equipment market, with 55.8 million people aged 65 and above reported in 2020 [5] - Technological innovations such as CAD/CAM systems and AI diagnostics are enhancing treatment efficacy and expanding product use [6] - There is a growing emphasis on preventive care, leading to increased consumption of preventive dental products [6] - Trends towards minimally invasive and cosmetic dentistry are expanding market segments for specialized dental consumables [7] - Emerging markets, particularly in Asia-Pacific, are experiencing faster growth rates due to rising healthcare expenditure and improved access to care [8] Economic Impact - U.S. tariffs have significantly increased costs on essential imported dental items, with tariffs ranging from 10% to over 50%, leading to higher operational costs for manufacturers and distributors [10] - The industry is gradually shifting supply chains towards domestic production to mitigate tariff exposure, while dental associations are advocating for tariff exemptions [10] Industry Performance - The Zacks Medical Dental Supplies industry has underperformed compared to the broader sector and the S&P 500, with a collective decline of 0.4% over the past year [13] - The industry is currently trading at a forward P/E of 16.05X, lower than the S&P 500's 22.7X and the sector's 18.4X [16] Company Insights - West Pharmaceutical is expected to sustain growth momentum through 2025, with projected revenues between $3.04 billion and $3.06 billion, reflecting an organic growth of 3-3.75% [22] - McKesson is experiencing strong operational momentum, with a projected revenue gain of 13.3% for fiscal 2025 [31] - Cardinal Health anticipates adjusted EPS in the range of $8.05-$8.15 for fiscal 2025, despite facing pricing pressures and inflationary impacts [37] - Cooper Companies expects revenue growth of approximately 5.7% for 2025, supported by strong demand in both CooperVision and CooperSurgical segments [43]