ZIMMER BIOMET HOLDINGS INC (ZBH)
US98956P1021 - Common Stock
ZBH gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 187 industry peers in the Health Care Equipment & Supplies industry. While ZBH has a great profitability rating, there are some minor concerns on its financial health. ZBH is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
ZBH had positive earnings in the past year.
ZBH had a positive operating cash flow in the past year.
ZBH had positive earnings in 4 of the past 5 years.
ZBH had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ZBH's Return On Assets of 4.99% is amongst the best of the industry. ZBH outperforms 85.03% of its industry peers.
Looking at the Return On Equity, with a value of 8.76%, ZBH belongs to the top of the industry, outperforming 83.42% of the companies in the same industry.
ZBH has a Return On Invested Capital of 7.19%. This is amongst the best in the industry. ZBH outperforms 84.49% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ZBH is below the industry average of 8.19%.
The 3 year average ROIC (5.54%) for ZBH is below the current ROIC(7.19%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.99% | ||
| ROE | 8.76% | ||
| ROIC | 7.19% |
ROA(3y)2.52%
ROA(5y)2.32%
ROE(3y)4.43%
ROE(5y)4.26%
ROIC(3y)5.54%
ROIC(5y)4.94%
1.3 Margins
ZBH has a Profit Margin of 14.27%. This is amongst the best in the industry. ZBH outperforms 90.37% of its industry peers.
With an excellent Operating Margin value of 20.43%, ZBH belongs to the best of the industry, outperforming 93.05% of the companies in the same industry.
In the last couple of years the Operating Margin of ZBH has grown nicely.
ZBH's Gross Margin of 71.78% is amongst the best of the industry. ZBH outperforms 82.35% of its industry peers.
ZBH's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.43% | ||
| PM (TTM) | 14.27% | ||
| GM | 71.78% |
OM growth 3Y23.17%
OM growth 5Y3.66%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1%
GM growth 5Y0.04%
2. Health
2.1 Basic Checks
ZBH has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ZBH has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, ZBH has more shares outstanding
The debt/assets ratio for ZBH has been reduced compared to a year ago.
2.2 Solvency
ZBH has an Altman-Z score of 2.73. This is not the best score and indicates that ZBH is in the grey zone with still only limited risk for bankruptcy at the moment.
ZBH's Altman-Z score of 2.73 is fine compared to the rest of the industry. ZBH outperforms 65.24% of its industry peers.
ZBH has a debt to FCF ratio of 6.59. This is a slightly negative value and a sign of low solvency as ZBH would need 6.59 years to pay back of all of its debts.
The Debt to FCF ratio of ZBH (6.59) is better than 74.33% of its industry peers.
ZBH has a Debt/Equity ratio of 0.38. This is a healthy value indicating a solid balance between debt and equity.
ZBH's Debt to Equity ratio of 0.38 is in line compared to the rest of the industry. ZBH outperforms 44.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 6.59 | ||
| Altman-Z | 2.73 |
ROIC/WACC0.86
WACC8.35%
2.3 Liquidity
ZBH has a Current Ratio of 1.36. This is a normal value and indicates that ZBH is financially healthy and should not expect problems in meeting its short term obligations.
ZBH has a worse Current ratio (1.36) than 82.35% of its industry peers.
A Quick Ratio of 0.70 indicates that ZBH may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.70, ZBH is doing worse than 91.98% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
ZBH shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.98%, which is quite good.
Measured over the past years, ZBH shows a decrease in Earnings Per Share. The EPS has been decreasing by -0.21% on average per year.
ZBH shows a small growth in Revenue. In the last year, the Revenue has grown by 4.34%.
Measured over the past years, ZBH shows a decrease in Revenue. The Revenue has been decreasing by -1.40% on average per year.
EPS 1Y (TTM)8.98%
EPS 3Y10.06%
EPS 5Y-0.21%
EPS Q2Q%5.45%
Revenue 1Y (TTM)4.34%
Revenue growth 3Y1.72%
Revenue growth 5Y-1.4%
Sales Q2Q%4.03%
3.2 Future
The Earnings Per Share is expected to grow by 6.63% on average over the next years.
Based on estimates for the next years, ZBH will show a small growth in Revenue. The Revenue will grow by 4.27% on average per year.
EPS Next Y6.69%
EPS Next 2Y7.11%
EPS Next 3Y6.89%
EPS Next 5Y6.63%
Revenue Next Year3.89%
Revenue Next 2Y4.22%
Revenue Next 3Y4.34%
Revenue Next 5Y4.27%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.47, ZBH is valued correctly.
93.58% of the companies in the same industry are more expensive than ZBH, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.20, ZBH is valued rather cheaply.
A Price/Forward Earnings ratio of 12.26 indicates a correct valuation of ZBH.
ZBH's Price/Forward Earnings ratio is rather cheap when compared to the industry. ZBH is cheaper than 93.58% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.73, ZBH is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.47 | ||
| Fwd PE | 12.26 |
4.2 Price Multiples
ZBH's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ZBH is cheaper than 92.51% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ZBH is valued cheaply inside the industry as 88.24% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.61 | ||
| EV/EBITDA | 10.77 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ZBH does not grow enough to justify the current Price/Earnings ratio.
ZBH has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.01
PEG (5Y)N/A
EPS Next 2Y7.11%
EPS Next 3Y6.89%
5. Dividend
5.1 Amount
ZBH has a yearly dividend return of 0.91%, which is pretty low.
ZBH's Dividend Yield is rather good when compared to the industry average which is at 1.68. ZBH pays more dividend than 92.51% of the companies in the same industry.
With a Dividend Yield of 0.91, ZBH pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
5.2 History
The dividend of ZBH has a limited annual growth rate of 0.21%.
ZBH has been paying a dividend for at least 10 years, so it has a reliable track record.
ZBH has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)0.21%
Div Incr Years0
Div Non Decr Years11
5.3 Sustainability
ZBH pays out 18.29% of its income as dividend. This is a sustainable payout ratio.
ZBH's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP18.29%
EPS Next 2Y7.11%
EPS Next 3Y6.89%
ZIMMER BIOMET HOLDINGS INC
NYSE:ZBH (12/23/2024, 10:08:05 AM)
106.305
-0.81 (-0.76%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners93.36%
Inst Owner Change-1.48%
Ins Owners0.07%
Ins Owner Change1.68%
Market Cap21.16B
Analysts69.71
Price Target127.03 (19.5%)
Short Float %3.34%
Short Ratio4.57
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
Dividend Growth(5Y)0.21%
DP18.29%
Div Incr Years0
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.32%
Min EPS beat(2)-0.7%
Max EPS beat(2)0.07%
EPS beat(4)3
Avg EPS beat(4)0.8%
Min EPS beat(4)-0.7%
Max EPS beat(4)2.75%
EPS beat(8)6
Avg EPS beat(8)2.64%
EPS beat(12)9
Avg EPS beat(12)3.5%
EPS beat(16)13
Avg EPS beat(16)3.56%
Revenue beat(2)1
Avg Revenue beat(2)-0.15%
Min Revenue beat(2)-0.92%
Max Revenue beat(2)0.62%
Revenue beat(4)2
Avg Revenue beat(4)-0.14%
Min Revenue beat(4)-0.92%
Max Revenue beat(4)0.62%
Revenue beat(8)5
Avg Revenue beat(8)1.13%
Revenue beat(12)8
Avg Revenue beat(12)0.14%
Revenue beat(16)9
Avg Revenue beat(16)-1.31%
PT rev (1m)0.99%
PT rev (3m)-1.57%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.02%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)-0.95%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.21%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.47 | ||
| Fwd PE | 12.26 | ||
| P/S | 2.79 | ||
| P/FCF | 21.61 | ||
| P/OCF | 13.38 | ||
| P/B | 1.71 | ||
| P/tB | N/A | ||
| EV/EBITDA | 10.77 |
EPS(TTM)7.89
EY7.42%
EPS(NY)8.67
Fwd EY8.16%
FCF(TTM)4.92
FCFY4.63%
OCF(TTM)7.94
OCFY7.47%
SpS38.15
BVpS62.16
TBVpS-6.04
PEG (NY)2.01
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.99% | ||
| ROE | 8.76% | ||
| ROCE | 8.55% | ||
| ROIC | 7.19% | ||
| ROICexc | 7.42% | ||
| ROICexgc | 32.61% | ||
| OM | 20.43% | ||
| PM (TTM) | 14.27% | ||
| GM | 71.78% | ||
| FCFM | 12.9% |
ROA(3y)2.52%
ROA(5y)2.32%
ROE(3y)4.43%
ROE(5y)4.26%
ROIC(3y)5.54%
ROIC(5y)4.94%
ROICexc(3y)5.66%
ROICexc(5y)5.07%
ROICexgc(3y)23.79%
ROICexgc(5y)22.87%
ROCE(3y)6.58%
ROCE(5y)5.87%
ROICexcg growth 3Y27.04%
ROICexcg growth 5Y-0.97%
ROICexc growth 3Y31.48%
ROICexc growth 5Y5.31%
OM growth 3Y23.17%
OM growth 5Y3.66%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y1%
GM growth 5Y0.04%
F-Score8
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 6.59 | ||
| Debt/EBITDA | 1.88 | ||
| Cap/Depr | 61.81% | ||
| Cap/Sales | 7.93% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 62.62% | ||
| Profit Quality | 90.4% | ||
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.7 | ||
| Altman-Z | 2.73 |
F-Score8
WACC8.35%
ROIC/WACC0.86
Cap/Depr(3y)55.02%
Cap/Depr(5y)55.27%
Cap/Sales(3y)7.29%
Cap/Sales(5y)7.34%
Profit Quality(3y)239.64%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)8.98%
EPS 3Y10.06%
EPS 5Y-0.21%
EPS Q2Q%5.45%
EPS Next Y6.69%
EPS Next 2Y7.11%
EPS Next 3Y6.89%
EPS Next 5Y6.63%
Revenue 1Y (TTM)4.34%
Revenue growth 3Y1.72%
Revenue growth 5Y-1.4%
Sales Q2Q%4.03%
Revenue Next Year3.89%
Revenue Next 2Y4.22%
Revenue Next 3Y4.34%
Revenue Next 5Y4.27%
EBIT growth 1Y13.05%
EBIT growth 3Y25.3%
EBIT growth 5Y2.21%
EBIT Next Year32.78%
EBIT Next 3Y12.97%
EBIT Next 5Y8.95%
FCF growth 1Y1.01%
FCF growth 3Y3.93%
FCF growth 5Y-7.37%
OCF growth 1Y12.47%
OCF growth 3Y9.5%
OCF growth 5Y-1.97%