ZIMMER BIOMET HOLDINGS INC (ZBH)
US98956P1021 - Common Stock
ZBH gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 188 industry peers in the Health Care Equipment & Supplies industry. ZBH scores excellent on profitability, but there are some minor concerns on its financial health. ZBH scores decently on growth, while it is valued quite cheap. This could make an interesting 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.
In the past 5 years ZBH always reported a positive cash flow from operatings.
1.2 Ratios
ZBH has a Return On Assets of 4.99%. This is amongst the best in the industry. ZBH outperforms 85.56% of its industry peers.
With an excellent Return On Equity value of 8.76%, ZBH belongs to the best of the industry, outperforming 83.96% of the companies in the same industry.
The Return On Invested Capital of ZBH (7.19%) is better than 83.96% of its industry peers.
ZBH had an Average Return On Invested Capital over the past 3 years of 5.54%. This is below the industry average of 8.23%.
The last Return On Invested Capital (7.19%) for ZBH is above the 3 year average (5.54%), which is a sign of increasing profitability.
| 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
Looking at the Profit Margin, with a value of 14.27%, ZBH belongs to the top of the industry, outperforming 90.37% of the companies in the same industry.
Looking at the Operating Margin, with a value of 20.43%, ZBH belongs to the top 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ZBH is destroying value.
ZBH has less shares outstanding than it did 1 year ago.
The number of shares outstanding for ZBH has been increased compared to 5 years ago.
Compared to 1 year ago, ZBH has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.75 indicates that ZBH is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of ZBH (2.75) is better than 63.10% of its industry peers.
The Debt to FCF ratio of ZBH is 6.59, which is on the high side as it means it would take ZBH, 6.59 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ZBH (6.59) is better than 74.87% 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 has a Debt to Equity ratio of 0.38. This is comparable to the rest of the industry: ZBH outperforms 43.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | 6.59 | ||
| Altman-Z | 2.75 |
ROIC/WACC0.85
WACC8.41%
2.3 Liquidity
A Current Ratio of 1.36 indicates that ZBH should not have too much problems paying its short term obligations.
ZBH has a worse Current ratio (1.36) than 82.89% of its industry peers.
A Quick Ratio of 0.70 indicates that ZBH may have some problems paying its short term obligations.
The Quick ratio of ZBH (0.70) is worse than 92.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.98% over the past year.
ZBH shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -0.21% yearly.
The Revenue has been growing slightly by 4.34% in the past year.
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
Based on estimates for the next years, ZBH will show a small growth in Earnings Per Share. The EPS will grow by 4.71% on average per year.
The Revenue is expected to grow by 4.44% on average over the next years.
EPS Next Y6.7%
EPS Next 2Y7.17%
EPS Next 3Y6.86%
EPS Next 5Y4.71%
Revenue Next Year3.89%
Revenue Next 2Y4.26%
Revenue Next 3Y4.38%
Revenue Next 5Y4.44%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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 13.74, ZBH is valued correctly.
Based on the Price/Earnings ratio, ZBH is valued cheaply inside the industry as 94.65% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 28.96, ZBH is valued rather cheaply.
The Price/Forward Earnings ratio is 12.49, which indicates a correct valuation of ZBH.
Based on the Price/Forward Earnings ratio, ZBH is valued cheaper than 94.12% of the companies in the same industry.
ZBH is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 23.82, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.74 | ||
| Fwd PE | 12.49 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ZBH is valued cheaper than 91.98% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ZBH is valued cheaper than 89.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.03 | ||
| EV/EBITDA | 10.87 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ZBH may justify a higher PE ratio.
PEG (NY)2.05
PEG (5Y)N/A
EPS Next 2Y7.17%
EPS Next 3Y6.86%
5. Dividend
5.1 Amount
With a yearly dividend of 0.88%, ZBH is not a good candidate for dividend investing.
ZBH's Dividend Yield is rather good when compared to the industry average which is at 1.68. ZBH pays more dividend than 93.05% of the companies in the same industry.
With a Dividend Yield of 0.88, ZBH pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.88% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)0.21%
Div Incr Years0
Div Non Decr Years11
5.3 Sustainability
18.29% of the earnings are spent on dividend by ZBH. This is a low number and sustainable payout ratio.
The dividend of ZBH is growing, but earnings are growing more, so the dividend growth is sustainable.
DP18.29%
EPS Next 2Y7.17%
EPS Next 3Y6.86%
ZIMMER BIOMET HOLDINGS INC
NYSE:ZBH (11/21/2024, 8:04:00 PM)
After market: 108.4 0 (0%)108.4
-0.87 (-0.8%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupHealth Care Equipment & Services
GICS IndustryHealth Care Equipment & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap21.58B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.88% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.74 | ||
| Fwd PE | 12.49 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.05
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.99% | ||
| ROE | 8.76% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 20.43% | ||
| PM (TTM) | 14.27% | ||
| GM | 71.78% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.38 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.36 | ||
| Quick Ratio | 0.7 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)8.98%
EPS 3Y10.06%
EPS 5Y
EPS Q2Q%
EPS Next Y6.7%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.34%
Revenue growth 3Y1.72%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y