What Happened?
Shares of dental products company Dentsply Sirona (NASDAQ: XRAY) rose 1.1% in the afternoon session after the U.S. Securities and Exchange Commission (SEC) concluded its investigation into the company's accounting practices and did not intend to recommend any enforcement action. The probe, which began in 2022, had focused on the dental-supplies maker's use of incentives to sell products to distributors in 2021 and whether those incentives were properly accounted for in financial reports. The conclusion of the investigation removed a significant uncertainty for investors. In a filing, Dentsply Sirona noted that it had fully cooperated with the SEC and viewed the closure of the probe without any enforcement action as a "significant and favorable development.".
After the initial pop the shares cooled down to $12.92, up 3.6% from previous close.
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What Is The Market Telling Us
Dentsply Sirona’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock dropped 2.9% on the news that worries over worsening trade relations with China were triggered by critical comments from President Donald Trump. The president's tone and the suggestion of canceling a meeting with President Xi caused a rapid sell-off in the market. The trade dispute flared up after China imposed export controls on rare earth minerals, which are critical components for high-tech manufacturing. The escalation of the trade war raises concerns about supply chain disruptions and increased costs for technology companies, which are heavily reliant on global trade, leading to a broad sell-off in the sector.
Dentsply Sirona is down 31.1% since the beginning of the year, and at $12.92 per share, it is trading 47.8% below its 52-week high of $24.73 from October 2024. Investors who bought $1,000 worth of Dentsply Sirona’s shares 5 years ago would now be looking at an investment worth $284.47.
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