(Reuters) – Zimmer Biomet Holdings Inc on Tuesday raised its full-year profit forecast, anticipating demand to hold up for its medical devices following a rebound in knee and hip replacement procedures.
The company also beat estimates for profit to extend a strong second quarter for the industry that is benefiting from patients resuming non-urgent procedures and surgeries postponed during the pandemic and staffing shortages easing at hospitals.
Abbott Laboratories attributed its strong quarter to hospitals addressing bottlenecks from the pandemic while Johnson & Johnson said it expected to top profit estimates with surgeries bouncing back.
Combined sales at Zimmer’s hips and knees units rose 7% to $1.28 billion from a year earlier, compared to the average $1.21 billion by four analysts, according to Refinitiv data.
The company now expects full-year profit of $7.47 to $7.57 per share, compared with its previous forecast of $7.40 to $7.50.
Analysts were expecting an annual profit of $7.45 per share.
While expectations were high, the results support the brokerage’s positive view regarding both Zimmer’s improved competitiveness and persisting growth in orthopedic markets, Baird Equity Research analyst Jeff Johnson said in a note.
The Indiana-based company’s second-quarter revenue rose nearly 5% to $1.87 billion, beating analysts’ estimates of $1.83 billion.
Zimmer also expects reported revenue to grow between 6.5% and 7% this year, compared to its prior forecast of between 5% and 6%.
Excluding items, the company earned $1.82 per share, compared with estimates of $1.81.
(This story has been corrected to remove a reference to Abbott’s hips and knees unit in paragraph 3)
(Reporting by Mariam Sunny in Bengaluru; Editing by Sriraj Kalluvila)
