ZBH changes
Pick any two versions below to diff them.
- Price
- $94.00 → $94.86(+0.9%)
- Discount
- 20% to 34% → 19% to 33%(−1.0 pts)
- Next earnings
- 2026-11-05 → 2026-11-04
- Next earnings is estimate
- Yes → No
- Thesis
- The market doubts that Zimmer Biomet can grow as fast as the market for joint replacements. Knees are its largest business, and knee sales were flat in Q2 2026, up only 0.1% at constant currency, with sales outside the US down 1.5%. Organic constant currency growth was 2.9% in Q1 and 4.0% in Q2 2026, and full-year guidance is 2.25% to 3.25%. The company is changing how it sells in the US and in other markets, and it said these changes reduce sales in 2026. Leadership changes add to the doubt. The CFO left in April 2026 and an interim CFO still served in August, and the head of the Americas and global businesses left on September 30, 2026. For the gap to close, three things must be true. Knee sales must return to growth, with help from the ROSA robot and new products such as the ROSA Shoulder System cleared in 2026. Organic growth must reach at least the top of the 2026 guidance and rise in 2027 after the sales changes are complete. Adjusted EPS must reach the guided $8.47 to $8.59 for 2026, and free cash flow must fund the planned $1 billion of buybacks in 2026 while debt stays stable. The first check is the Q3 2026 report, expected in early on November 4, 2026. The 2027 guidance in early 2027 is the main check. If knee sales and organic growth improve, the gap can close over the next four to six quarters. If growth stays below the market, the gap can stay.
- Checkpoints
- Nov 54, 2026 (estimate): Q3 2026 results: knee sales and organic growth. Pending. Watch: Knee sales that grow again and organic growth at or above the top of the 2026 guidance pass; flat or lower knee sales or a cut to the guidance fail. Feb 2027 (estimate): Full-year 2026 results and 2027 guidance. Pending. Watch: 2027 guidance with organic growth higher than in 2026 and a permanent CFO in place pass; guidance for growth below the 2026 level fails. Q2 2027 (estimate): US sales changes complete. Pending. Watch: Stable sales teams and higher US knee and hip growth after the changes pass; lost agents or lower US growth fail.
- Recent events
- 2026-10-13: Zimmer Biomet and THINK Surgical extended for several years their exclusive agreement for the TMINI handheld robot, which works with the Persona Knee System. The companies did not give the financial terms or the exact length. 2026-10-06: Zimmer Biomet said that it will report Q3 2026 results at 6:30 a.m. ET on November 4, 2026, with a call at 8:30 a.m. ET. 2026-09-08: Zimmer Biomet changed its Americas and global business leadership to speed up its US sales changes. Kevin Thornal, Group President of Global Businesses and the Americas, left on September 30, 2026. From October 1, Gary Campbell leads the Americas, Brian Hatcher leads Recon, S.E.T., CMFT, Neuro and Biosurgery, and Bradley Kessler leads Americas robotics, technology and data. 2026-08-05: Zimmer Biomet reported Q2 2026 results. Net sales were $2.177 billion, up 4.8%, or 4.0% on an organic constant currency basis. Knee sales were flat at constant currency, and hip sales grew 5.1%. Adjusted EPS was $2.07, the same as a year earlier. It raised 2026 guidance to 2.25% to 3.25% organic constant currency growth and $8.47 to $8.59 of adjusted EPS. It also received FDA clearance for the next-generation ROSA Shoulder System. 2026-06-26: Zimmer Biomet signed a new five-year $1.5 billion revolving credit facility, to June 2031, and a new 364-day $1.25 billion revolving credit facility, to June 2027. 2026-05-12: Zimmer Biomet said that it now expects to buy back up to $1 billion of its stock in 2026, $250 million more than planned, under its $1.5 billion authorization from February 2026. 2026-04-28: Zimmer Biomet reported Q1 2026 results. Net sales were $2.087 billion, up 9.3%, or 2.9% on an organic constant currency basis. Adjusted EPS was $2.09, up 15.5%. On April 22, CFO Suketu Upadhyay said that he would resign on April 28 to take a new job. Controller Paul Stellato became interim CFO while the company searches for a permanent CFO.