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Zimmer Biomet Holdings Financial Strength

: 5 (As of Jun. 2022)
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Zimmer Biomet Holdings has the Financial Strength Rank of 5.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Zimmer Biomet Holdings's Interest Coverage for the quarter that ended in Jun. 2022 was 8.64. Zimmer Biomet Holdings's debt to revenue ratio for the quarter that ended in Jun. 2022 was 0.86. As of today, Zimmer Biomet Holdings's Altman Z-Score is 2.74.


Competitive Comparison

For the Medical Devices subindustry, Zimmer Biomet Holdings's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Zimmer Biomet Holdings Financial Strength Distribution

For the Medical Devices & Instruments industry and Healthcare sector, Zimmer Biomet Holdings's Financial Strength distribution charts can be found below:

* The bar in red indicates where Zimmer Biomet Holdings's Financial Strength falls into.



Zimmer Biomet Holdings Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Zimmer Biomet Holdings's Interest Expense for the months ended in Jun. 2022 was $-39 Mil. Its Operating Income for the months ended in Jun. 2022 was $335 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jun. 2022 was $5,300 Mil.

Zimmer Biomet Holdings's Interest Coverage for the quarter that ended in Jun. 2022 is

Interest Coverage=-1*Operating Income (Q: Jun. 2022 )/Interest Expense (Q: Jun. 2022 )
=-1*335.4/-38.8
=8.64

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Zimmer Biomet Holdings's Debt to Revenue Ratio for the quarter that ended in Jun. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Jun. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(851.9 + 5299.6) / 7127.2
=0.86

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Zimmer Biomet Holdings has a Z-score of 2.74, indicating it is in Grey Zones. This implies that Zimmer Biomet Holdings is in some kind of financial stress. If it is below 1.81, the company may faces bankrupcy risk.

Warning Sign:

Altman Z-score of 2.74 is in the grey area. This implies that the company is under some kind of financial stress. If it is below 1.8, the company may face bankruptcy risk.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Zimmer Biomet Holdings  (NYSE:ZBH) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Zimmer Biomet Holdings has the Financial Strength Rank of 5.


Zimmer Biomet Holdings Financial Strength Related Terms

Thank you for viewing the detailed overview of Zimmer Biomet Holdings's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Zimmer Biomet Holdings Business Description

Zimmer Biomet Holdings logo
Address
345 East Main Street, Warsaw, IN, USA, 46580
Zimmer Biomet designs, manufactures, and markets orthopedic reconstructive implants, as well as supplies and surgical equipment for orthopedic surgery. With the acquisitions of Centerpulse in 2003 and Biomet in 2015, Zimmer holds the leading share of the reconstructive market in the United States, Europe, and Japan. Roughly 70% of total revenue is derived from sales of large joints, another quarter comes from extremities, trauma, and related surgical products.
Executives
Stellato Paul A officer: VP, Controller & CAO C/O XYLEM INC 1 INTERNATIONAL DRIVE RYE BROOK NY 10573
Van Zuilen Wilfred officer: Pres, Europe, M. East & Africa 345 E. MAIN STREET WARSAW IN 46580
Winkler Lori officer: SVP and CHRO 345 E. MAIN STREET WARSAW IN 46580
Kolli Sreelakshmi director C/O ALIGN TECHNOLOGY INC. 2820 ORCHARD PARKWAY SAN JOSE CA 94131
Ellingson Rachel officer: SVP & CSO 345 E MAIN STREET WARSAW K7 46580
Nichol Carrie Ann officer: VP, Controller & CAO 927 GRANDVIEW DRIVE EXTON PA 19341
Upadhyay Suketu officer: Exec. VP, CFO 345 E. MAIN STREET WARSAW IN 46580
Tornos Ivan officer: Group President, Orthopedics 345 E. MAIN STREET WARSAW IN 46580
Deltort Didier officer: President, EMEA 345 E. MAIN STREET WARSAW IN 46580
Hilado Maria Teresa director 1200 WILLOW LAKE BLVD. P.O.BOX 64683 ST. PAUL MN 55110
Jafry Syed A. director 345 E. MAIN STREET WARSAW IN 46580
Bruneau Aure officer: Group President 345 E. MAIN STREET WARSAW IN 46580
Hanson Bryan C director, officer: President and CEO ZIMMER BIOMET HOLDINGS 345 E. MAIN STREET WARSAW IN 46580
Delp Robert D. officer: President, Americas 345 EAST MAIN STREET WARSAW IN 46580
Schwarzman Stephen A 10 percent owner C/O BLACKSTONE INC. 345 PARK AVE NEW YORK NY 10154

Zimmer Biomet Holdings Headlines

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