After issues related to a Department of Justice investigation involving Zimmer Holdings
The company's Q3 results weren't all that shabby, and I respect management's transparency about the lowered guidance, but the news did trip up shareholders, with shares of Zimmer trading down more than 14% today. The company revised its Q4 adjusted earnings per share guidance from $1.16 to a range of $1.03 to $1.05; management said it expects lower sales, and that contributed to most of the revision.
Zimmer's adjusted EPS for the third quarter increased 18% over the year-ago quarter, as net sales increased by 10%. Its knee implant business, which now accounts for 42% of net sales, experienced a 12% jump versus the year-ago quarter. The company's second-biggest line, hip implants, also posted respectable growth of 8% for the quarter.
The pullback in the share price is understandable, given previous expectations for Zimmer's Q4. However, the results for Q3 were solid, and the company as a whole has performed extremely well since it was spun off by Bristol-Myers Squibb
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