We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
What's in the Cards for Zimmer Biomet (ZBH) in Q1 Earnings?
Read MoreHide Full Article
Zimmer Biomet Holdings, Inc. (ZBH - Free Report) is scheduled to report first-quarter 2024 results on May 2, before market open.
In the last reported quarter, the company’s earnings of $2.20 exceeded the Zacks Consensus Estimate by 2.3%. Over the trailing four quarters, its earnings outperformed the consensus estimate on three occasions and matched the same once, the average beat being 4.99%.
Let’s take a look at how things have shaped up prior to this announcement.
Factors at Play
Like its industry competitors, Zimmer Biomet’s business too is currently entangled in several headwinds, including supply challenges, a tough labor market and the current geopolitical landscape. All these have been resulting in significant margin deceleration. However, the company also assumes these headwinds to ease out, banking on its strong pipeline and the solid execution of its growth strategies. This is likely to be reflected in the first-quarter top-line results of the company.
Overall, Zimmer Biomet is expected to have witnessed procedure volume improvement in its legacy business in the first quarter. Strong strategic execution and innovations are expected to have driven first-quarter revenues from the Knees and Hip businesses.
Within the Hips business, the company is expected to have witnessed procedure volume recovery banking on strategic product launches in the first quarter. Previously, the company had talked about three new meaningful product launches early in 2024. If that has taken place, we expect the company to report a strong revenue increase within this category. Added to this, Zimmer Biomet is expected to have witnessed strong performance across Avenir Complete hip. Moreover, continued solid ROSA pull-through in the hip category, especially in the United States, should significantly contribute to the top line within the Hip category.
Zimmer Biomet Holdings, Inc. Price and EPS Surprise
Going by our model, the Hip business of Zimmer Biomet is projected to grow 2.6% in the first quarter on a year-over-year basis.
Within the Knee business, apart from a strong recovery in elective procedures, easy comparisons outside the United States, strong knee procedure recovery across most regions, continued global traction in the Persona knee system and continued increase in Rosa procedure penetration and pull-through are expected to have been driving factors.
The company is expected to have also gained from the earlier launch of the cementless knee. The first quarter is likely to have seen a full quarter of strong market penetration of the system. The company, in this regard, noted that the penetration rate in cementless knee is not even in the 20% range and is expected to reach 50% to 60% at a very rapid pace, banking on new launches.
The company is also expected to have gained from the uptake of Persona OsseoTi Keel Tibia for Cementless Knee Replacement. With ROSA, the company is expected to have witnessed strong gross adoption in the Ambulatory Surgical Centers settings. Further, the recent acquisitions of Embody and ReLign are expected to have contributed to Knees sales in the first quarter. However, industry-wide pressure related to GLP-1 drugs and the perceived impact on obesity is expected to have disrupted ZBH’s Knee business.
For the Knee business, our model shows no change in revenue growth on a year-over-year basis in the first quarter.
The S.E.T. business (comprising Surgical, Sports Medicine, Foot and Ankle, Extremities and Trauma) is expected to have performed well across key focus areas of CMFT (craniomaxillofacial and thoracic), sports medicine and upper extremities. Zimmer Biomet is also likely to have gained from the launch of the Identity shoulder system in the United States. Meanwhile, the business might have witnessed pressure from reimbursement headwinds within the Restorative Therapies. In addition, the company has been experiencing acute supply challenges within Sports and Trauma. These trends are expected to have disrupted the company’s S.E.T. revenues in the fourth quarter.
For this business, our model projects year-over-year revenue growth of 1% in the first quarter.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter 2024 revenues is pegged at $1.87 billion, suggesting a 2.3% rise from the year-ago reported figure.
The Zacks Consensus Estimate for the company’s first-quarter 2024 earnings per share of $1.88 indicates a 0.53% decline from the year-ago adjusted earnings.
What Our Model Suggests
Per our proven model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a higher chance of beating estimates. This is not the case, as you can see below.
Earnings ESP: Zimmer Biomet has an Earnings ESP of -1.07%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks to Consider
Here are a few medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
TransMedics has an expected earnings growth rate of 81.8% for 2024. TMDX surpassed earnings in each of the trailing four quarters, the average being 107.83%.
Inspire Medical Systems (INSP - Free Report) has an Earnings ESP of +18.04% and a Zacks Rank #1. The company is set to release first-quarter 2024 results on May 7.
INSP has an expected long-term earnings growth rate of 51.4% compared to the S&P 500’s 17.1%. The company surpassed earnings in each of the trailing four quarters, the average being 353.55%.
Insulet (PODD - Free Report) currently has an Earnings ESP of +11.11% and a Zacks Rank #2. The company is set to release its first-quarter 2024 results on May 9.
PODD has an expected long-term earnings growth rate of 18.1% compared with the industry’s 11.4%. The company surpassed earnings in each of the trailing four quarters, the average being 100.09%.
Image: Bigstock
What's in the Cards for Zimmer Biomet (ZBH) in Q1 Earnings?
Zimmer Biomet Holdings, Inc. (ZBH - Free Report) is scheduled to report first-quarter 2024 results on May 2, before market open.
In the last reported quarter, the company’s earnings of $2.20 exceeded the Zacks Consensus Estimate by 2.3%. Over the trailing four quarters, its earnings outperformed the consensus estimate on three occasions and matched the same once, the average beat being 4.99%.
Let’s take a look at how things have shaped up prior to this announcement.
Factors at Play
Like its industry competitors, Zimmer Biomet’s business too is currently entangled in several headwinds, including supply challenges, a tough labor market and the current geopolitical landscape. All these have been resulting in significant margin deceleration. However, the company also assumes these headwinds to ease out, banking on its strong pipeline and the solid execution of its growth strategies. This is likely to be reflected in the first-quarter top-line results of the company.
Overall, Zimmer Biomet is expected to have witnessed procedure volume improvement in its legacy business in the first quarter. Strong strategic execution and innovations are expected to have driven first-quarter revenues from the Knees and Hip businesses.
Within the Hips business, the company is expected to have witnessed procedure volume recovery banking on strategic product launches in the first quarter. Previously, the company had talked about three new meaningful product launches early in 2024. If that has taken place, we expect the company to report a strong revenue increase within this category. Added to this, Zimmer Biomet is expected to have witnessed strong performance across Avenir Complete hip. Moreover, continued solid ROSA pull-through in the hip category, especially in the United States, should significantly contribute to the top line within the Hip category.
Zimmer Biomet Holdings, Inc. Price and EPS Surprise
Zimmer Biomet Holdings, Inc. price-eps-surprise | Zimmer Biomet Holdings, Inc. Quote
Going by our model, the Hip business of Zimmer Biomet is projected to grow 2.6% in the first quarter on a year-over-year basis.
Within the Knee business, apart from a strong recovery in elective procedures, easy comparisons outside the United States, strong knee procedure recovery across most regions, continued global traction in the Persona knee system and continued increase in Rosa procedure penetration and pull-through are expected to have been driving factors.
The company is expected to have also gained from the earlier launch of the cementless knee. The first quarter is likely to have seen a full quarter of strong market penetration of the system. The company, in this regard, noted that the penetration rate in cementless knee is not even in the 20% range and is expected to reach 50% to 60% at a very rapid pace, banking on new launches.
The company is also expected to have gained from the uptake of Persona OsseoTi Keel Tibia for Cementless Knee Replacement. With ROSA, the company is expected to have witnessed strong gross adoption in the Ambulatory Surgical Centers settings. Further, the recent acquisitions of Embody and ReLign are expected to have contributed to Knees sales in the first quarter. However, industry-wide pressure related to GLP-1 drugs and the perceived impact on obesity is expected to have disrupted ZBH’s Knee business.
For the Knee business, our model shows no change in revenue growth on a year-over-year basis in the first quarter.
The S.E.T. business (comprising Surgical, Sports Medicine, Foot and Ankle, Extremities and Trauma) is expected to have performed well across key focus areas of CMFT (craniomaxillofacial and thoracic), sports medicine and upper extremities. Zimmer Biomet is also likely to have gained from the launch of the Identity shoulder system in the United States. Meanwhile, the business might have witnessed pressure from reimbursement headwinds within the Restorative Therapies. In addition, the company has been experiencing acute supply challenges within Sports and Trauma. These trends are expected to have disrupted the company’s S.E.T. revenues in the fourth quarter.
For this business, our model projects year-over-year revenue growth of 1% in the first quarter.
Q1 Estimates
The Zacks Consensus Estimate for first-quarter 2024 revenues is pegged at $1.87 billion, suggesting a 2.3% rise from the year-ago reported figure.
The Zacks Consensus Estimate for the company’s first-quarter 2024 earnings per share of $1.88 indicates a 0.53% decline from the year-ago adjusted earnings.
What Our Model Suggests
Per our proven model, a stock with a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a higher chance of beating estimates. This is not the case, as you can see below.
Earnings ESP: Zimmer Biomet has an Earnings ESP of -1.07%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #3.
Stocks to Consider
Here are a few medical stocks worth considering, as these have the right combination of elements to post an earnings beat this quarter.
TransMedics Group (TMDX - Free Report) has an Earnings ESP of +240.00% and a Zacks Rank #1. The company is expected to release first-quarter 2024 results soon. You can see the complete list of today’s Zacks #1 Rank stocks here.
TransMedics has an expected earnings growth rate of 81.8% for 2024. TMDX surpassed earnings in each of the trailing four quarters, the average being 107.83%.
Inspire Medical Systems (INSP - Free Report) has an Earnings ESP of +18.04% and a Zacks Rank #1. The company is set to release first-quarter 2024 results on May 7.
INSP has an expected long-term earnings growth rate of 51.4% compared to the S&P 500’s 17.1%. The company surpassed earnings in each of the trailing four quarters, the average being 353.55%.
Insulet (PODD - Free Report) currently has an Earnings ESP of +11.11% and a Zacks Rank #2. The company is set to release its first-quarter 2024 results on May 9.
PODD has an expected long-term earnings growth rate of 18.1% compared with the industry’s 11.4%. The company surpassed earnings in each of the trailing four quarters, the average being 100.09%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.