Robert F. Kennedy Jr. attends a marketing campaign occasion for Republican presidential nominee and former U.S. President Donald Trump in Milwaukee, Wisconsin, U.S. November 1, 2024.
Joel Angel Juarez | Reuters
Dental care provider Henry Schein superior in Monday buying and selling as buyers wager that Robert F. Kennedy Jr., President-elect Donald Trump’s choose for Well being and Human Providers secretary, might suggest eradicating fluoride from the U.S. water system, a transfer that may result in a increase in dental visits.
Shares of Henry Schein shares jumped about 7.5%, notching its greatest day since 2022. Fellow dental product makers Dentsply Sirona and Envista additionally rose within the session.
Monday’s strikes come as buyers prepared for public well being adjustments below a second Trump administration. Kennedy posted on X earlier than the presidential election this month {that a} “Trump White Home will advise all U.S. water programs to take away fluoride from public water.”
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Fluoride has lengthy been proven as an efficient methodology for preventing cavities. However the mineral has discovered itself on the heart of a nationwide struggle that is led some native communities to finish applications centered on its insertion into public water.
Whereas Kennedy might want to win Senate approval to take the job, market contributors are already zeroing in on a gaggle of shares that make dental hygiene merchandise as potential beneficiaries of his insurance policies. That is as a result of taking fluoride out of water would truly put the tooth cleansing business in increased demand as customers look elsewhere to struggle cavities, based on agency Gordon Haskett.
A basic view of the Henry Schein Inc. constructing a distributor of well being care services with a presence in 32 international locations, as photographed in Melville, New York.
Bruce Bennett | Getty Pictures
“The thought right here is RFK will carry to HHS a voice that’s in favor of decreasing, or eliminating, the quantity of fluoridation that’s added to ingesting water,” Don Bilson, Gordon Haskett’s head of event-driven analysis, instructed shoppers in a Monday observe. “It will, in flip, result in an acceleration of tooth decay and extra dental visits.”
Henry Schein shares took a leg up in afternoon buying and selling following a Reuters report that activist investor Ananym Capital was calling for adjustments on the firm. The newly launched agency, which is led by Charlie Penner and Alex Silver, believes the board must be shaken up and prices must be lower, amongst different concepts.
Henry Schein and different shares within the house supply a brilliant spot inside a sector that has largely struggled for the reason that election. The Well being Care Choose Sector SPDR Fund (XLV) has tumbled greater than 3% in November, placing it on observe for its first three-month shedding steak since final yr. By comparability, the broad S&P 500 has climbed greater than 3% within the month.
Gordon Haskett’s Bilson additionally identified that dental shares have been a few of the few “spared” health-focused equities as buyers responded to the announcement of Kennedy’s nomination final week. Pharmaceutical names have been below strain given Kennedy’s repute as a vaccine skeptic, whereas processed meals shares took successful as merchants equipped for elevated scrutiny of so-called junk meals.
“It triggered widespread promoting throughout the healthcare panorama,” Bilson stated of the choice to pick Kennedy. “Drugmakers, contract analysis organizations, and well being insurers all felt the quake. Quite than cease there, the injury spilled into packaged meals. And promoting.”
Whereas the market seems to be shifting on Kennedy’s nomination, Bilson stated that regulatory adjustments would seemingly take years to come back into impact. He additionally famous that ingesting water ought to fall extra below the Environmental Safety Company than Well being and Human Providers.