Zimmer Biomet Holdings, Inc. (ZBH)
Quantitative Summary
DeterministicAt 21.3x earnings — a 67% discount to the sector average of 65.2x — ZBH is in the lower valuation range. Financial health is average: Piotroski 4/9, Altman Z 2.4. DCF fair value of $126 implies 32% upside from current prices based on model assumptions.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of Zimmer Biomet Holdings reveal a capital allocation challenge where the return on invested capital of 4.3% falls significantly short of the weighted average cost of capital at 7.3%, generating a negative spread that erodes long-term shareholder value despite moderate profitability metrics. This weakness in operational efficiency is reflected in a DuPont ROE decomposition driven primarily by leverage (equity multiplier of 1.82x) rather than superior margins or asset turnover, as the company operates with an asset turnover ratio of only 0.36x. While the high gross margin of 69.7% and net margin of 8.6% suggest pricing power in its product mix, the Piotroski F-Score of 4/9 indicates mediocre financial strength relative to peers, compounded by a low Altman Z-Score of 2.4 that flags potential distress risks under stress scenarios, even though the Beneish M-Score of -2.57 offers some reassurance regarding earnings manipulation.
Valuation metrics present a dichotomy between current market pricing and intrinsic model estimates, with the stock trading at a forward P/E multiple of 25.6x that remains meaningfully discounted against the sector average of 36.8x. Discounted cash flow analysis suggests a fair value target of $129, implying approximately 42.2% upside potential if management can successfully execute on an implied free cash flow growth rate of just 3.4% over the next decade. This valuation gap may reflect market skepticism regarding the company's ability to sustain profitability given its negative capital spread and modest revenue expansion of 7.2%, creating a scenario where the current price embeds conservative expectations for future operational improvement.
Risk-adjusted performance data highlights significant downside exposure, as evidenced by an annual Fama-French alpha of -20.89% which suggests underperformance relative to risk factors over time. Although the stock exhibits a positive value tilt with a HML factor score of 0.612 and neutral profitability characteristics (RMW at 0.071), recent insider activity shows $347,339 in net selling over the past ninety days, adding another layer of caution to the risk/reward profile for potential entrants.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 7% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 6% | 7.4% | 9.4% |
|---|---|---|---|
| 2% | $146 | $103 | $68 |
| 3% | $195 | $126 | $79 |
| 4% | $292 | $164 | $94 |
Center = base case. Green = >10% upside, Red = >10% downside vs $83.75.
Pre-computed DCF: WACC=7.4%, terminal growth 3%. Fair value $126 (+32.4%). Not investment advice.
Valuation Context
Currently trading 41% below its 5-year average P/E of 44.7x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedZBH is trading above its 50-day simple moving average but below its 200-day simple moving average, indicating a potential short-term uptrend amidst an overall sideways to slightly downward long-term trend. The RSI at 49 suggests the stock is near neutral in terms of momentum, without showing significant overbought or oversold conditions.
Quant Health Deep Dive
Profitability & Value Creation
✅ Conservative payout — room for dividend increases.
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Insider Activity (Last 90 Days)
Open-market buys vs sells by company insiders. Source: yfinance.
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-03-31 | $0.2400 | 0.0% |
| 2025-12-30 | $0.2400 | 0.0% |
| 2025-09-30 | $0.2400 | 0.0% |
| 2025-06-26 | $0.2400 | 0.0% |
| 2025-03-31 | $0.2400 | 0.0% |
| 2024-12-30 | $0.2400 | 0.0% |
| 2024-09-30 | $0.2400 | 0.0% |
| 2024-06-26 | $0.2400 | 0.0% |
| 2024-03-27 | $0.2400 | 0.0% |
| 2023-12-26 | $0.2400 | 0.0% |
| 2023-09-28 | $0.2400 | 0.0% |
| 2023-06-23 | $0.2400 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like MOAT or XHE, the fund manager is mechanically forced to buy or sell ZBH shares regardless of Zimmer Biomet Holdings, Inc.'s individual fundamentals. We estimate $2.6B of passive capital is structurally linked to ZBH through 8 tracked ETFs. Index rebalances and ETF creation/redemption cycles can create noticeable volume spikes unrelated to company news.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in Zimmer Biomet Holdings, Inc. to visualize passive redemption contagion across ETFs and collateral stocks.
If Zimmer Biomet Holdings, Inc. (ZBH) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies ELI LILLY + CO (LLY) as the most exposed collateral stock, sharing 1 ETFs with ZBH. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 29 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
ZBH Ownership Dynamics
Passive funds hold 1 in every 6 ZBH shares, reducing daily market volatility.
Zimmer Biomet Holdings, Inc. (ZBH) exerts notable gravity on the passive index market, currently representing 2.3% of the MOAT (MOAT) and 1.6% of the XHE (XHE). Across 29 tracked ETFs, approximately 33M shares (16.9% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest ZBH Exposure
Float lock-up computed from 29 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
ZBH Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for Zimmer Biomet Holdings, Inc. over the past year sits near $92.72 (12% of 252-day volume). The current price of $83.75 sits 9.7% below the POC — suggesting potential mean-reversion upside if institutional demand reasserts at this level. The highly concentrated volume profile (12% at POC) indicates strong consensus on fair value — institutional participants have repeatedly transacted near this price.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
ZBH Capital Efficiency
How efficiently does Zimmer Biomet Holdings, Inc. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
Zimmer Biomet Holdings, Inc. converts 64% of its EBITDA into free cash flow, an exceptional conversion rate indicating an asset-light business model with minimal capital reinvestment drag. However, the ROIC-WACC spread is negative (-3.0%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-08 | 107 | $83.37 | $8,920.59 |
| 2026-05-01 | 87 | $82.43 | $7,171.41 |
| 2026-04-28 | 10 | $92.59 | $925.9 |
| 2026-04-27 | 302 | $91.26 | $27,560.52 |
| 2026-04-23 | 14,583 | $93.04 | $1.4M |
| 2026-04-20 | 7,461 | $94.78 | $707,153.58 |
| 2026-04-17 | 1,057 | $94.78 | $100,182.46 |
| 2026-04-16 | 5,450 | $94.20 | $513,390 |
| 2026-04-15 | 3 | $96.52 | $289.56 |
| 2026-04-14 | 180 | $95.34 | $17,161.2 |
| 2026-04-13 | 140 | $93.12 | $13,036.8 |
| 2026-04-10 | 168 | $93.03 | $15,629.04 |
| 2026-04-09 | 212 | $93.01 | $19,718.12 |
| 2026-04-08 | 1,163 | $91.40 | $106,298.2 |
| 2026-04-02 | 1,541 | $91.03 | $140,277.23 |
| 2026-03-31 | 1,478 | $88.62 | $130,980.36 |
| 2026-03-30 | 84 | $88.57 | $7,439.88 |
| 2026-03-25 | 20 | $86.32 | $1,726.4 |
| 2026-03-23 | 8,372 | $87.87 | $735,647.64 |
| 2026-03-20 | 1,321 | $89.84 | $118,678.64 |
| 2026-03-17 | 6,052 | $93.30 | $564,651.6 |
| 2026-03-10 | 407 | $93.28 | $37,964.96 |
| 2026-03-09 | 2,747 | $94.11 | $258,520.17 |
| 2026-03-06 | 50,656 | $93.45 | $4.7M |
| 2026-03-05 | 5,073 | $95.75 | $485,739.75 |
| 2026-03-04 | 5,604 | $97.97 | $549,023.88 |
| 2026-02-24 | 19,769 | $99.46 | $2.0M |
| 2026-02-19 | 15,973 | $98.25 | $1.6M |
| 2026-02-18 | 57 | $97.15 | $5,537.55 |
| 2026-02-13 | 14,038 | $95.18 | $1.3M |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| BDX | 0.472 | 0.460 | Moderate |
| OC | 0.434 | 0.462 | Moderate |
| WMS | 0.419 | 0.262 | Moderate |
| CRUS | 0.411 | 0.455 | Moderate |
| SYK | 0.404 | 0.365 | Moderate |
| BLD | 0.391 | 0.298 | Moderate |
| MDT | 0.389 | 0.279 | Moderate |
| COO | 0.375 | 0.369 | Moderate |
| ITW | 0.375 | 0.284 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare ZBH to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.