Wells Fargo Resumes Zimmer Holdings (ZMH) at Outperform, Positively Positioned
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Price: $77.94 -2.32%
Rating Summary:
10 Buy, 15 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 12 | Down: 19 | New: 22
Rating Summary:
10 Buy, 15 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 12 | Down: 19 | New: 22
Trade ZMH Now!
Wells Fargo is resuming coverage on shares of Zimmer Holdings (NYSE: ZMH) with an Outperform rating, a new analyst, and a valuation range of $69-$71.
The firm believes that the orthopedic procedure market will accelerate in 2011 after its decline over the last two years. Wells Fargo is anticipating on 5% growth in 2011 as it notes that 44% of hip and knee replacement procedures done in patients below 65 years old. With a majority of the procedures being done in the older population, the firm expects that ZMH will really benefit from the annual increase in the 65+ population in the US. Wells Fargo estimates that it will accelerate from 1.7% in 2010 to 2.2% in 2011 and 3.5% in 2012. This represents the beginning of the 79 million baby boomer population.
With concern over the metal on metal hip replacement procedure still in the air, Wells Fargo believes that ZMH will continue to benefit and outperform the markets growth rate. This is due to the company's minimal exposure compared to some of its competitors. The company experienced 3% growth world wide in the hip market in Q4:10, where as the overall market was flat for the quarter.
Wells Fargo comments that, "We note that 30bps of the decline is attributable to the bi-annual Japanese price cuts in April 2010 and will anniversary in April 2011. On the mix side, ZMH should benefit from rebound in non-Medicare patients, which tend to use higher priced implants, as the economy recovers and Japanese approval of its first trabecular metal product at a 20% price premium."
For more ratings news on Zimmer Holdings click here and for the rating history of Zimmer Holdings click here.
Shares of Zimmer Holdings closed at $60.57 yesterday, with a 52 week range of $46.27-$65.22.
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The firm believes that the orthopedic procedure market will accelerate in 2011 after its decline over the last two years. Wells Fargo is anticipating on 5% growth in 2011 as it notes that 44% of hip and knee replacement procedures done in patients below 65 years old. With a majority of the procedures being done in the older population, the firm expects that ZMH will really benefit from the annual increase in the 65+ population in the US. Wells Fargo estimates that it will accelerate from 1.7% in 2010 to 2.2% in 2011 and 3.5% in 2012. This represents the beginning of the 79 million baby boomer population.
With concern over the metal on metal hip replacement procedure still in the air, Wells Fargo believes that ZMH will continue to benefit and outperform the markets growth rate. This is due to the company's minimal exposure compared to some of its competitors. The company experienced 3% growth world wide in the hip market in Q4:10, where as the overall market was flat for the quarter.
Wells Fargo comments that, "We note that 30bps of the decline is attributable to the bi-annual Japanese price cuts in April 2010 and will anniversary in April 2011. On the mix side, ZMH should benefit from rebound in non-Medicare patients, which tend to use higher priced implants, as the economy recovers and Japanese approval of its first trabecular metal product at a 20% price premium."
For more ratings news on Zimmer Holdings click here and for the rating history of Zimmer Holdings click here.
Shares of Zimmer Holdings closed at $60.57 yesterday, with a 52 week range of $46.27-$65.22.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
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