ZBH
Zimmer Biomet Holdings, Inc.
$94.99
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 78.4% above fair value
You pay
$94.99
Bear
$42.60
Fair
$53.25
Bull
$63.90
Bear
$42.60
-55.2%
$3.55 × 12x P/E
Fair
$53.25
-43.9%
$3.55 × 15x P/E
Bull
$63.90
-32.7%
$3.55 × 18x P/E
Adjust Assumptions
15.0x
3.55$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
26.8x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (42 analysts)
$103.11
Divergence from AlphaVal
48%
Summary
Applying a 15x P/E to adjusted EPS of $3.55, the base-case value is $53.25 per share.
Warnings
Wall Street's average price target is $103.11 (from 42 analysts). Our estimate is 48% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples