4 Medical Supply Stocks Poised to Gain in a Prospering Industry

The Zacks Medical - Dental Supplies industry in the Medical sector is likely to continue its upward momentum in 2026, backed by persistent innovation, an aging population with increasing healthcare needs and normalized orders following significant destocking since COVID-19.

In 2026, the industry is likely to see continued adoption of digital services and AI-enabled assessment tools that enhance patient experience and reduce administrative burdens for physicians. These services support faster response times through rapid treatment planning and greater personalization. Advanced robotics and automated storage and retrieval systems are transforming logistics, cutting human intervention by nearly 75% for some companies, while stricter U.S. and European regulations are boosting demand for high-value products.

Several players in the industry are focusing on expanding into higher-margin, faster-growing specialty areas like oncology, urology, autoimmune and retina/ophthalmology. Precision health and theranostics are likely to be game-changing trends for the industry in 2026. Moreover, the industry anticipates a long-term tailwind from biosimilars as branded biologics lose exclusivity, necessitating robust distribution and participation strategies. Meanwhile, care delivery models are shifting toward ambulatory surgery centers and at-home services.

Per a Markets and Markets report, the global medical supplies industry is expected to reach $163.5 billion by 2027, at a CAGR of 3.4% in the 2022-2027 period. Industry participants, such as McKesson MCK, Cardinal Health CAH, West Pharmaceutical Services WST and Align Technology ALGN, are likely to ride on the favorable macro trends amid lingering tariff risks.

Industry Description

The global dental industry consists of companies that design, develop, make and market dental products, such as consumables, laboratory products and specialty items. Some of these companies also offer software and systems for practice management, patient education and office administration. Dental stocks have been drawing attention amid a recovery in sales following the weakness caused by pandemic-induced disruptions. The market has been recovering and maintaining its position.

Notably, dental care is provided based on the advice and recommendations of the American Dental Association and the Centers for Disease Control and Prevention. Thanks to the rebound seen among companies in this space, patient volumes have been increasing steadily following the removal of COVID-19 restrictions.

Major Trends Shaping the Future of the Medical Dental Supplies Industry

Increasing Burden of Oral Diseases and an Aging Population: The U.S. dental equipment market is driven by the country's growing geriatric population. This group is a significant demographic in dental surgeries and other dental practices. Per the U.S. Census Bureau, the country had 55.8 million people aged 65 and above in 2020. Old age increases the likelihood of dental issues, including cavities, root and coronal caries, and periodontitis. Consequently, the rising number of seniors in the country is a key contributor to the market’s growth.

Technological Innovations: Advances such as CAD/CAM systems, 3D imaging, laser dentistry, AI diagnostics, digital dentistry, and improved bonding materials enhance treatment efficacy and broaden product use, fueling market growth.

Growing Awareness and Emphasis on Preventive Care: Public health initiatives and rising oral care awareness among populations increase consumption of preventive dental products like fluoride treatments, sealants and prophylaxis pastes.

Minimally Invasive and Cosmetic Dentistry Trends: Increasing preference for less invasive treatments and cosmetic procedures, such as teeth whitening and veneers, expands market segments for specialized dental consumables and equipment.

Expansion of Dental Clinics and Group Practices: An increasing number of dental care facilities, including hospitals, clinics and corporate dental chains, is driving higher product demand due to greater patient footfall and standardized usage protocols.

Regional Market Growth Drivers: Emerging markets, especially in Asia-Pacific, benefit from rising healthcare expenditure, improved access to care, government support, and dental tourism, contributing to faster growth rates.

Government Initiatives and Insurance Coverage: Policies supporting oral health, improved dental insurance coverage, and public dental health programs enhance accessibility and consumption of dental supplies.

Economic Factors and Healthcare Infrastructure: Strong healthcare infrastructure and higher disposable income in developed regions like North America support the adoption of advanced dental products and technologies.

Tariff War Raises Uncertainty: U.S. tariffs in 2025 have significantly affected the dental supplies industry by increasing costs on essential imported items, such as burs, handpieces, CAD/CAM blocks, dental implants, and prosthetics, many of which are sourced from China, Europe and Mexico. Tariffs have led to increased prices and supply-chain disruptions, forcing manufacturers, distributors, and dental practitioners to face higher operational costs.

The rise in costs is often passed to dental clinics and patients, raising treatment costs and slowing inventory restocking. The industry is responding by shifting supply chains toward domestic or regional production to reduce tariff exposure, although this transition is gradual. Dental associations are actively advocating for tariff exemptions to alleviate cost burdens and maintain care accessibility.

Zacks Industry Rank

The Zacks Medical Dental Supplies industry falls within the broader Zacks Medical sector.

It carries a Zacks Industry Rank #74, which places it in the top 30% of 243 Zacks industries.

The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all member stocks, indicates dull near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Before we present a few dental supply stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Industry Performance

The industry has outperformed its sector but underperformed the S&P 500 composite in the past year.

Stocks in this industry collectively gained 6.6% compared with the Zacks Medical sector’s rise of 1.9%. The S&P 500 has gained 13.6% in the same time frame.

One-Year Price Performance

Industry's Current Valuation

On the basis of the forward 12-month price-to-earnings (P/E), which is commonly used for valuing medical stocks, the industry is currently trading at 17.67X compared with the S&P 500’s 22.81X and the sector’s 21.17X.

Over the past five years, the industry has traded as high as 21.75X and as low as 15.94X, with the median being 18.66X, as the charts show.

Price-to-Earnings Forward Twelve Months (F12M)

Price-to-Earnings Forward Twelve Months (F12M)

4 Promising Dental Supply Stocks

West Pharmaceutical is well-positioned to maintain its growth momentum in 2026, supported by strong demand for proprietary products, innovation-driven launches and ongoing capacity expansion. High-value product (HVP) components, such as NovaPure and Daikyo, remain key contributors, benefiting from broad adoption across biologics, vaccines and injectable therapies as well as implementation of Drug Supply Chain Security Act (DSCSA) in the United States and Annex 1 regulations in Europe. Rising demand for self-injection systems and containment solutions, particularly in GLP-1 and oncology pipelines, is expected to sustain order activity.

Operational improvements through advanced automation, expanded molding capacity, and footprint optimization are driving greater efficiency and cost benefits. Strategic partnerships with major pharma and biotech companies are enhancing visibility into future projects, while deeper involvement in early-stage development work positions West Pharmaceutical to secure commercial manufacturing opportunities later in the product lifecycle. Its continued focus on integrated drug delivery solutions, combining containment and delivery technologies, further strengthens its competitive edge.

However, short-term headwinds remain. Although the company plans to mitigate tariff-related costs in 2026, they are likely to hurt margins this year. Moreover, the rise of oral GLP-1 therapies increases the risk of future market share shifts from injectables, which could potentially pressure the top line. The company also believes that sustaining robust growth rates for GLP-1 elastomers will be challenging. In addition, a significant contract manufacturing agreement is set to expire in mid-2026, representing a $40 million headwind in the second half of 2026.

The company aims for organic revenue growth of 7-9% over the long-term.

The Zacks Consensus Estimate for 2026 revenues indicates year-over-year growth of 6% and the same for earnings suggests an improvement of 8.1%. Currently, the company carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Price and Consensus: WST

McKesson heads into 2026 with solid operational momentum, supported by multiple growth drivers across its broad healthcare services portfolio. Specialty and oncology distribution remain central to its strategy, strengthened by the recent acquisitions of Core Ventures and PRISM Vision, which extend McKesson’s reach in oncology, retina and ophthalmology. These additions expand provider networks and increase demand for group purchasing, distribution and practice management services.

The Prescription Technology Solutions segment continues to benefit from strong demand for access and affordability programs — particularly prior authorization support for GLP-1 therapies — leveraging McKesson’s deep connectivity with pharmacies and healthcare providers. In the U.S. Pharmaceutical segment, higher prescription volumes from national retail accounts and specialty categories, combined with efficiency gains, continue to drive profitability. Ongoing investments in automation and cold-chain logistics further enhance distribution reliability, throughput and support for high-growth therapeutic areas.

Still, McKesson faces potential headwinds, including regulatory changes to Medicare payment models, evolving drug pricing frameworks and uncertainty around potential pharmaceutical tariffs. Rising competition in oncology and biopharma services, payer formulary shifts, and specialty supply-chain complexities may also weigh on the company’s performance. Effective integration of recent acquisitions and broader economic pressures on healthcare utilization remain key factors to watch through the rest of the year.

McKesson expects its fiscal 2026 earnings per share (EPS) to be in the range of $38.35-$38.85. The company expects total revenues to grow 11-15% and operating profit to improve 12-16%.

The Zacks Consensus Estimate for fiscal 2026 revenues indicates a gain of 13.7% from the year-ago reported figure, while the same for earnings implies an improvement of 16.8%. It carries a Zacks Rank #2 (Buy) at present.

Price and Consensus: MCK

Cardinal Health is expected to maintain its operational momentum in 2026, driven by steady performance across both its Pharmaceutical and Medical segments. In Pharmaceutical, growth will likely come from continued volume gains with large retail chains, strong specialty distribution and expanding partnerships with health systems. Specialty therapeutics, particularly in oncology and chronic care, remain key revenue drivers, supported by Cardinal Health’s extensive distribution network and manufacturer service offerings. Rising biosimilar adoption and growing demand for patient support programs further strengthen the segment’s outlook.

The Medical segment continues to benefit from recovering procedural volumes, solid demand for Cardinal Health’s at-Home Solutions and greater supply-chain stability. Efforts to simplify the product portfolio, modernize manufacturing, and expand automation are boosting efficiency and margins. New product launches in single-use surgical devices and lab testing consumables are also reinforcing its competitive position.

However, Cardinal Health faces several challenges. Competitive pricing pressures, generic deflation, and inflation-related costs for freight and labor could affect margins. Regulatory uncertainty around drug pricing and biosimilar reimbursement, along with consolidation among retail pharmacy customers, may add headwinds. Execution on portfolio and cost transformation initiatives also remains an area to watch in the coming quarters.

CAHexpects adjusted EPS to be at least $10.00 for fiscal 2026. The company expects revenues from its Pharmaceutical segment to grow 15-17% year over year. Revenues from the Medical segment are estimated to grow 2-4%. Revenues from the Other segment are likely to grow 26-28%.

The Zacks Consensus Estimate for fiscal 2026 revenues indicates an improvement of 16.3% from the year-ago reported figure, while the same for earnings implies a rise of 20.5%. CAH carries a Zacks Rank #2 at present.

Price and Consensus: CAH

Align Technology is positioned to benefit in 2026 from its restructuring actions, technological innovation, the launch of a new product suite, and continued momentum among Dental Support Organizations (DSOs). Continued robust demand in EMEA and APAC, along with the company’s focus on driving utilization in emerging markets such as India, Turkey and Southeast Asia, also looks promising.

The company’s restructuring actions, aimed at reducing ongoing costs, sharpening operational focus and enhancing capital efficiency, are nearing completion. These initiatives are expected to lift operating margins by at least 100 basis points year over year in 2026.

Meanwhile, ALGN is expanding the reach of exocad ART (Advanced Restorative Treatment) to additional countries in 2026 following successful pilot programs. Tools such as ClinCheck Live Plan, which can automate treatment plans in as little as 15 minutes, are also expected to improve office efficiency and patient conversion rates. In addition, 2026 will mark the commercial debut of products manufactured through direct fabrication (3D printing).These steps should boost the top-line growth for the company going forward.

A major driver for 2026 will be the broader release of the 0x3 product suite in North America during the first quarter. This includes a product that offers three years of treatment without built-in refinements, allowing doctors to purchase them only if needed. Align Technology views DSOs as a "force multiplier" and expects them to remain a high-growth segment into 2026. DSOs have demonstrated an ability to grow at double-digit rates, even in mixed economic environments, by leveraging digital workflows and patient financing.

Management indicated that the company intends to operate within its long-term model of 5-15% growth, which they believe can continue to generate operating margin leverage

For this San Jose, CA-based company, the Zacks Consensus Estimate for 2026 revenues indicates a 3.7% improvement from the prior-year reported figure, while the same for earnings implies an increase of 7.4%. Presently, the company carries a Zacks Rank of 2.

Price and Consensus: ALGN

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This article originally published on Zacks Investment Research (zacks.com).

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