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Zimmer Declines 6.4% on Poor Q4 Results

Shares of Zimmer Biomet Holdings, Inc. (ZBH) declined 6.4% at the time of writing after the musculoskeletal healthcare company reported disappointing fourth-quarter results.

Adjusted earnings of $1.95 per share declined 7.6% year-over-year and came below analysts’ expectations of $1.98 per share. Revenue during the quarter fell 2.3% year-over-year to $2.04 billion. Also, the figure lagged the Street’s estimate of $2.07 billion.

Product-wise, Knees generated net sales of $720.1 million, down slightly from the same quarter last year. Hips and S.E.T products fell 4.6% and 5.6%, respectively. Further, Dental & Spine revenues declined 4.1%.

For 2021, net sales stood at $7.84 billion, up 11.6% from the prior year. Also, Zimmer reported adjusted earnings of $7.37, up from $5.67 in 2020.

The Chairman, President and CEO of Zimmer, Bryan Hanson, said, “As we expected, the ongoing COVID pandemic continued to pressure our business in Q4. The quarter was particularly impacted throughout December due to hospital staffing shortages and the Omicron variant surge worldwide… We continued to execute in the quarter and are focused on delivering on our mission and driving value for all stakeholders.”

Outlook

Zimmer anticipates revenues to either decline 4% in 2022 or remain in line with the revenues reported in 2021. Also, adjusted EPS is likely to remain in the range of $6.40 to $6.80. Adjusted operating profit margin is expected to be between 26.5% and 27.5%.

Zimmer Earnings

The company’s EPS for the fourth quarter of 2021 is estimated to reach $1.98. Zimmer stock earnings beat estimates in the past few years, and given the impressive earnings history, it will likely beat estimates again in the fourth quarter.

Overall, the consensus among analysts is a Hold based on 4 Buys, 8 Holds and 1 Sell.

Blogger Opinion

TipRanks data shows that financial blogger opinions are 75% Bullish on ZBH, compared to the sector average of 70%.

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