Global orthopedic and surgical products company -
) recently announced the acquisition of NORMED Medizin-Technik
GmbH, a Germany-based medical company. However, financial terms
of the deal were not disclosed.
NORMED currently provides a comprehensive product line of
specialized plates, screws and instruments. This includes systems
for bone reconstruction and fracture repair, fusion procedures
and external fixation. According to Zimmer, with its
advanced technologies, especially for foot and ankle, hand and
wrist reconstruction and trauma markets, NORMED will strengthen
Zimmer's Extremities and Trauma product portfolios in these fast
growing market segments.
Zimmer offers a broad line of reconstructive implant and
trauma products, as well as orthopedic surgical instruments and
supplies. The Reconstructive Implant division, the largest at
Zimmer, manufactures joint replacement devices for knee, hips,
shoulders and elbows (extremities).
At present, the company is strengthening its product portfolio
to drive its top line. Moreover, the ongoing shift in demand to
premium products, such as Prolong and Vivacit-EHighly Crosslinked
Polyethylene, Trabecular MetalTM Technology products, high-flex
knees, porous hip stems and the introduction of patient specific
devices, is expected to continue to positively affect sales
growth. Along with the focus to drive Reconstructive and emerging
businesses, Zimmer is exploring opportunities to expand its reach
into early intervention products.
We are also encouraged with the favorable long-term trend for
Zimmer that points toward sustained growth driven by obesity,
wear and tear of joints from more active lifestyles, growth in
emerging markets, new material technologies, advances in surgical
techniques and proven clinical benefits of joint replacement
More importantly, the percentage of population over age 65 in
the U.S., Europe, Japan and other developed regions is expected
to nearly double by the year 2030. In the U.S., the oldest baby
boomers are now pushing retirement age. We believe that Zimmer is
benefiting from this aging demography since knee and hip joints
tend to wear out with age and therefore require replacement.
Meanwhile, in order to streamline its business, Zimmer plans
to continue with its global restructuring program. Several new
products are slated for launch that will have a positive impact
on the top line.However, macroeconomic uncertainties and
unfavorable currency adversely impacted sales during the last
Zimmer currently carries a Zacks Rank #3 (Hold). Other medical
sector stocks that warrant a look are
). All the stocks carry a Zacks Rank #1 (Strong Buy).
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