The 10-second takeaway
For the quarter ended June 30 (Q2), Zimmer Holdings missed slightly on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue dropped slightly and GAAP earnings per share grew significantly.
Margins improved across the board.
Zimmer Holdings booked revenue of $1.13 billion. The 24 analysts polled by S&P Capital IQ wanted to see revenue of $1.14 billion on the same basis. GAAP reported sales were 1.1% lower than the prior-year quarter's $1.14 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.34. The 26 earnings estimates compiled by S&P Capital IQ predicted $1.32 per share. GAAP EPS of $1.22 for Q2 were 15% higher than the prior-year quarter's $1.06 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 74.9%, 20 basis points better than the prior-year quarter. Operating margin was 29.6%, 560 basis points better than the prior-year quarter. Net margin was 19.1%, 120 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.04 billion. On the bottom line, the average EPS estimate is $1.17.
Next year's average estimate for revenue is $4.52 billion. The average EPS estimate is $5.27.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 600 members out of 628 rating the stock outperform, and 28 members rating it underperform. Among 199 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 193 give Zimmer Holdings a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Zimmer Holdings is outperform, with an average price target of $67.93.
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