Zimmer Biomet Holdings (STU:ZIM) GF Value Rank : 9 (As of Apr. 26, 2024)

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What is Zimmer Biomet Holdings GF Value Rank?

Zimmer Biomet Holdings has the GF Value Rank of 9.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

Competitive Comparison of Zimmer Biomet Holdings's GF Value Rank

For the Medical Devices subindustry, Zimmer Biomet Holdings's GF Value Rank, along with its competitors' market caps and GF Value Rank 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's GF Value Rank Distribution in the Medical Devices & Instruments Industry

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

* The bar in red indicates where Zimmer Biomet Holdings's GF Value Rank falls into.

Zimmer Biomet Holdings GF Value Rank Related Terms

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Zimmer Biomet Holdings (STU:ZIM) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Zimmer Biomet Holdings Inc (STU:ZIM) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

ZBH:USA ZBH:Austria

Address

345 East Main Street, Warsaw, IN, USA, 46580

Website

https://www.zimmerbiomet.com

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 two thirds of total revenue is derived from sales of large joints, another quarter comes from extremities, trauma, sports medicine, and related surgical products. The firm spun out its dental and spine businesses in 2022.