Waiting for a recovery in the orthopedics industry has been about as entertaining as watching paint dry, without the benefit of enjoying the fumes. Although it is certainly true that there are millions of Americans walking around on old knees and hips, and the number of 65+ year-old customers is on the increase, the reality is that a broadly favorable demographic push means nothing over the scale of a few years.
That makes Zimmer (ZMH) a tricky stock to assess. It certainly seems cheap relative to its likely future free cash flows, but the company's intense (70%-plus) exposure to hip and knee reconstruction is keeping a lid on enthusiasm in there here and now.
Read the full piece here:
Zimmer Is A Pure Play On A (Presently) Rotten Market
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