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We originally recommended Dentsply International (NDQ: XRAY) on Sept. 4 2007 (IWB #2731) at $39.38. The stock closed Friday at $34.26 (all figures in U.S. dollars).

It has been a long time since we updated this stock so you can be forgiven if you don't remember that this is one of the largest manufacturers and suppliers to the dental industry, with a global presence. The company has not fully recovered from the March swoon. Profits were up slightly in the third quarter but at least they were up.

It may be counterintuitive but dental care does suffer in a sour economy since many of its most profitable procedures are elective. However, for the most part, healthcare stocks (at least dental healthcare) are fairly defensive. Ironically, they are negatively impacted by rising metal prices but do benefit from a low U.S. dollar.

All in all, the recent results were pretty good compared to most industry groups and are likely to continue to show steady improvement from here. Rising standards of living around the world will lead to increased interest in dental hygiene, which over the long term will benefit the company. I think this would be a good time to consider taking a new position in this stock or adding to your current holding.

Action now: Buy with a target of $38.

Disclosure: Author holds a long position in XRAY

Source: Dentsply International: Drilling for Profits