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Needham & Company Reiterates Buy as Zimmer Biomet Holdings (ZBH) Acquires Medtech

July 18, 2016 11:58 AM EDT
Get Alerts ZBH Hot Sheet
Price: $128.54 +0.15%

Rating Summary:
    21 Buy, 22 Hold, 3 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 14 | Down: 18 | New: 17
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Needham & Company reiterated a Buy rating on Zimmer Biomet (NYSE: ZBH), and raised the price target to $143.00 (from $134.00), as the company acquires Medtech SA for €50 per share. Needham estimates that the deal values Medtech's equity at ~ $132M. Consensus estimates have Medtech generating FY16 sales of $10M, FY17 sales of $23M, and FY18 sales of $38M.

Analyst Mike Matson commented, "ZBH is acquiring the French robotics company Medtech SA for €50 per share (implying an equity value of ~$132M). Medtech's ROSA robot currently has applications in brain and spine surgery. Medtech's business has been more brain-oriented while Mazor Robotics' (MZOR) business has been more spineoriented. However, we expect this to change given ZBH's large spine implant business and as a result we now view ROSA as more of a threat to MZOR. We think that the deal is positive for ZBH since it provides it with a robotics platform that might eventually have applications beyond brain and spine surgery for a relatively low price. We have raised our price target to $143 from $134 given peer multiple expansion."

For an analyst ratings summary and ratings history on Zimmer Biomet click here. For more ratings news on Zimmer Biomet click here.

Shares of Zimmer Biomet closed at $125.42 yesterday.



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