With the first of millions of baby boomers getting ready to retire next year, our health-care system is sure to be tested. Dealing with everything from arthritis to joint pain to reconstructive surgery, the baby boomers are going to be lining up for non-elective surgeries. So who profits from all of this?

Good question. Companies like Stryker (NYSE: SYK) and Zimmer Holdings (NYSE: ZMH) that specialize in medical equipment, orthopedic implants, and surgical navigation systems should see demand skyrocket for their services and products. Competition is pretty fierce, however, with Johnson & Johnson's (NYSE: JNJ) DePuy, General Electric's (NYSE: GE) medical care segment, Medtronic (NYSE: MDT), and U.K.'s Smith & Nephew (NYSE: SNN). As a group, the six of these, along with private Biomet, form an oligopoly that dominates the space.

So let's take a look at which stock is a better buy, Stryker or Zimmer Holdings.

Latest News: Stryker recently reported a 6.9% (constant currency) increase in net sales and a 9.5% boost in net earnings. Orthopedic implant sales only increased by 1.4%, but that relatively slow growth was offset by a near 16% surge in medical equipment. Specifically, the spinal, emergency care, and navigation system segments saw dramatic increases. Overall, their financial outlook for the remainder of 2010 went unchanged. Zimmer reported a 3.3% (constant currency) increase in revenue and a less-than-stellar decrease in net earnings of 16.3%. Its spinal segment went down 9% -- although its been less than two since Zimmer acquired Abbot Spinal from Abbott Laboratories (NYSE: ABT). In addition to a "modest step-down" in orthopedics, Zimmer recognized a legal charge that no doubt affected the bottom line. Advantage: Stryker

Financials: Stryker has over $4 billion in cash and short-term investments and a debt/equity ratio of 15%; its operating margins are consistently above 20% and it's been able to boost revenues over the past five years by 9% per year on average. It pays a modest dividend of 1.3% and insider ownership is an impressive 14%. Zimmer has a solid hoard of cash and a debt/equity ratio of 20%; its operating margins are also 26%, and it's been able to boost revenues by 6% per year on average over the past five years. Its insider ownership is less than 1%, however, and although it doesn't pay a dividend, it does have a strong share buyback program. Slight Advantage: Stryker

Caps Rating: Our investment community of 165,000-plus members rate companies based on their ability to outperform the market. Stryker has five stars (out of five), while Zimmer has four. CAPS All-Star member edwjm, who's rated in the top 0.5% of all members, had this to say about Stryker last January:

Its products include implants, trauma, craniomaxillofacial and spinal surgeries; biologics; surgical, neurologic, ear, nose & throat and interventional pain equipment; endoscopic, surgical navigation. In other words, they are in the replacement body parts business. As the baby-boomers' hips and knees wear out, demand for their products should increase.

Not-quite-so-highly rated CAPS All-Star 00100 (this member is "only" in the top 2.5%) had this to say about Zimmer at about the same time:

Upthumb. Very good cash flow. 7% sales growth and 5% capex. High quick ratio, low debt ratio. 85% gross margins! Lots of room for market expansion.

While both companies enjoy good CAPS ratings, it doesn't get any better than five stars. Advantage: Stryker.

These are two companies that should enjoy increased demand for their products, in addition to the potential of more coverage because of health-care reform. While the success of Stryker and Zimmer are certainly not mutually exclusive, it serves investors well to compare competitors such as these two. At least in my opinion, it seems as though Stryker is bound to be serving up new hips and knees at a faster pace than Zimmer.

What do you think -- which company would you rather own? Sound off in the comments box below.