Zimmer Biomet Holdings, Inc.

This is our first report on the global medical technology behemoth Zimmer Biomet Holdings. The company saw better-than-expected growth this quarter, with sustained procedure recovery and strong progress with its innovation. They also benefited from some positive comps in the quarter. They observed another quarter of year-over-year growth in major joints, with their entire global hip and knee business expanding by more than 8% and 10% on an ex FX basis. Zimmer’s overall SET category expanded in the high single digits, led by solid performance in its business growth drivers, which include sports, CMFT, and upper extremities, as well as the anticipated tailwind from BVP comps in its Trauma business. The company intends to launch another 40-plus item by the end of 2025. In addition, they signed a definitive agreement to acquire Embody, Inc. for $155 million. The management believes this acquisition will boost overall revenue growth while modestly diluting adjusted earnings per share. We initiate coverage on the stock of Zimmer Biomet Holdings, Inc. with a ‘Hold’ rating.