Henry Schein (NASDAQ: HSIC) raises 2026 EPS guidance, though tariff refunds help

What happened

Henry Schein, Inc. (NASDAQ: HSIC) raised its 2026 non-GAAP earnings outlook to $5.50 to $5.56 a share on Nov. 3. The prior range was $5.29 to $5.39.

The company says the new range includes the net benefit from tariff refunds booked in the third quarter, limited growth investments in the fourth quarter, and better underlying business performance.

For the quarter ended Sept. 26, sales were $3.5 billion, up 4.0%. Internal growth in local currencies was 3.1% and acquisitions added 0.7%. GAAP diluted EPS was $1.06, up 26.2%. Non-GAAP diluted EPS was $1.56, up 13.0%.

Key numbers

Metric	Latest	Change	Source
Q3 non-GAAP diluted EPS	$1.56	from $1.38, +13.0%	SEC 8-K, Exhibit 99.1
Q3 GAAP diluted EPS	$1.06	from $0.84, +26.2%	SEC 8-K, Exhibit 99.1
U.S. dental merchandise sales, Q3	$660 million	from $607 million, +8.6%	SEC 8-K, Exhibit 99.1 (Exhibit A)
Adjusted EBITDA, first nine months	$898 million	from $810 million, +10.9%	Calculated from SEC 8-K
Operating cash flow, first nine months	$306 million	from $331 million, -7.6%	Calculated from SEC 8-K
2026 non-GAAP diluted EPS guidance	$5.50 to $5.56		SEC 8-K, Exhibit 99.1

Read more: Henry Schein (HSIC) company research

Where the growth came from

U.S. dental merchandise drove the quarter. Sales in that line rose 8.6% to $660 million from $607 million a year earlier. The company says the gain came mainly from volume from market share gains. Internal growth was 7.0% and acquisitions added 1.6%.

Other lines grew more slowly. Global medical distribution sales rose 1.1% and global dental equipment sales rose 2.3%. Global technology sales rose 5.2%. Internal growth of 6.5% was partly offset by a 1.3% decline from a business disposal.

Global value-added services sales fell 4.8% to $62 million from $64 million, on both a reported and internal basis.

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What the tariff refunds changed

Reported non-GAAP EPS includes a $0.19 per share net benefit from tariff refunds. The prior-year quarter's $1.38 included a $0.23 per share remeasurement gain.

Without both items, non-GAAP diluted EPS was $1.37 against $1.15 a year earlier, a rise of 19.1%. That is higher than the reported rate because the prior-year quarter had the larger one-time gain.

Margins, cash flow and buybacks

Adjusted EBITDA, a non-GAAP measure, was $898 million for the first nine months, up from $810 million a year earlier. That is an $88 million gain, or 10.9%. The margin widened 41 basis points to 8.72%.

In the third quarter alone, Adjusted EBITDA was $321 million against $295 million. The margin rose 40 basis points to 9.24%.

Cash flow moved the other way. Net cash from operating activities was $306 million for the nine months, down from $331 million. In the quarter it was $161 million, down from $174 million.

The company bought back about 5.7 million shares year to date at an average $79.50, spending $450 million. That is more than nine-month operating cash flow. It includes about 1.4 million shares bought in the third quarter at an average $86.67 for $125 million. About $330 million remains authorized and available.

Weighted average diluted shares were 112.5 million in the quarter against 121.0 million a year earlier. GAAP net income attributable to the company rose 17.1%, slower than diluted EPS. Bank credit lines stood at $1 billion on Sept. 26, up from $764 million on Dec. 27, 2025.

Why it matters

OptimistFi has argued that Henry Schein's stock works only if practice relationships and value-added services restore profit and cash growth beyond plain distribution. The quarter supports the profit side through volume-led dental share gains and wider margins. But operating cash flow and value-added services sales both fell.

The sales growth outlook stayed at 4.5% to 5.5%. Only the earnings and Adjusted EBITDA ranges moved. Adjusted EBITDA growth is now guided to high-single-digits, from mid to high-single-digits.

The better results are not purely organic. Guidance includes the tariff refund benefit and leaves out items such as restructuring, acquired-intangible amortization and litigation settlements. Nine-month non-GAAP net income was $473 million against GAAP net income of $320 million. The $153 million gap is mainly $81 million of acquisition intangible amortization, $44 million of restructuring costs and $28 million of shareholder advisory and value creation consulting costs, each net of tax.

What's next

The next test is the fourth-quarter report. Guidance assumes no significant tariff refunds or remeasurement gains for the rest of 2026. It also includes fourth-quarter growth investments that the company says will add to growth in 2027.

Non-GAAP EPS within the raised range without more refunds would back the underlying-profit claim. A shortfall would suggest the third quarter leaned on one-time help. Operating cash flow, down for the nine months, is the other figure to check.

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