Investors have generally been pretty willing to buy medical distributors at rich multiples, as the large sales forces, scale-based efficiencies, and long-term relationships with both suppliers and clients create some barriers to entry and the nature of the business tends toward solid cash generation. Patterson Companies (NASDAQ:PDCO) has had some recent challenges, though, and investors are not going to remain patient forever. While I like the potential of this company to continue to generate excess capital that can be passed along to shareholders, management will need to show better performance in the dental business to get the shares moving forward again.
Weather Doesn't Explain All Of The Challenges
Patterson's fiscal fourth quarter was marked by bad weather, but...
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