Morningstar

Zimmer Biomet Holdings Inc ZBH

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Stock XNYS Rating as of
$108.22 +0.51 (0.47%)
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As of Delayed Price Closed

Company Report

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Zimmer Biomet Adjusts to New Leadership, and Wide Moat Remains Intact

Debbie S. Wang

Zimmer Biomet is the undisputed king of large joint reconstruction, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for large-joint replacement that should offset price declines. However, Zimmer stumbled into a series of pitfalls in 2016-17, including integration issues, supply and inventory challenges, and quality concerns. The firm's efforts to turn around the firm have been admirable, though the pandemic slowed down progress. Now the firm is seeking to capitalize on the normalization of procedure volume and placements of its Rosa robot.

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Price vs Fair Value

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ZBH is trading within a range we consider fairly valued.
Price
$108.22
Fair Value
$196.00
Uncertainty
Medium
1-Star Price
$748.91
5-Star Price
$795.70
Economic Moat
Vmsx
Capital Allocation
Hgytcxfs

Bulls Say, Bears Say

Bulls

Zimmer Biomet has made impressive progress in placing its Rosa robots in hospitals and ambulatory surgical centers, paving the way for higher-margin implant pull through.

Bears

The scarcity of high-quality comparative effectiveness research data makes it more difficult for orthopedic companies to secure premium pricing at the same time payers and hospitals are raising the bar for cost-effectiveness.

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News

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Trading Information

Previous Close Price
$107.71
Day Range
$108.19–110.19
52-Week Range
$102.00–133.90
Bid/Ask
$106.01 / $110.55
Market Cap
$22.04 Bil
Volume/Avg
1.2 Mil / 1.5 Mil

Key Statistics

Price/Earnings (Normalized)
13.87
Price/Sales
2.99
Dividend Yield (Trailing)
0.89%
Dividend Yield (Forward)
0.89%
Total Yield
3.65%

Company Profile

Zimmer Biomet designs, manufactures, and markets orthopedic reconstructive implants, as well as supplies and surgical equipment for orthopedic surgery. With the acquisitions of Centerpulse in 2003 and Biomet in 2015, Zimmer holds the leading share of the reconstructive market in the United States, Europe, and Japan. Roughly two thirds of total revenue is derived from sales of large joints, another quarter comes from extremities, trauma, sports medicine, and related surgical products. The firm spun out its dental and spine businesses in 2022.
Sector
Healthcare
Industry
Medical Devices
Stock Style Box
Mid Value
Total Number of Employees
18,000
Website
https://www.zimmerbiomet.com

Competitors

Valuation

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Metric
ZBH
JNJ
SYK
Price/Earnings (Normalized)
 13.8715.4032.08
Price/Book Value
 1.745.436.95
Price/Sales
 2.994.586.48
Price/Cash Flow
 11.4617.4230.58
Price/Earnings
ZBH
JNJ
SYK

Financial Strength

Metric
ZBH
JNJ
SYK
Quick Ratio
 0.510.770.81
Current Ratio
 1.291.071.68
Interest Coverage
 6.0224.4512.28
Quick Ratio
ZBH
JNJ
SYK

Profitability

Metric
ZBH
JNJ
SYK
Return on Assets (Normalized)
 6.34%13.17%11.13%
Return on Equity (Normalized)
 10.81%32.42%23.26%
Return on Invested Capital (Normalized)
 8.45%20.93%14.77%
Return on Assets
ZBH
JNJ
SYK

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