Orthopedic Sector Strong For 2010
Shares of companies that make orthopedic implants, like Biomet, could be strong performers heading into 2010. Biomet, which is privately held, reported sales for its fiscal second quarter that showed revenue growth of eight percent, rising to $695.6 million. That included 15 percent growth in revenue from knee implants, an eight percent gain in hip implant revenue, and a 29 percent jump in revenue from procedures on the extremities. Total reconstructive revenue was up nine percent to $528.4 million.
Additionally, spinal revenue rose seven percent. In a note to clients, Deutsche Bank analyst Tao Levy said the results were “positive” for other orthopedic companies. In particular he said the knee implant revenue was a good sign and the growing hip revenue is positive for Stryker and Zimmer Holdings, Inc. in particular.
“Double-digit growth in the U.S. knee market is encouraging, especially since the knee market is more susceptible to procedure deferrals” due to the recession, Levy wrote. In afternoon trading, Zimmer shares rose to $61.96 and Stryker stock rose 67 cents to $53.32. Both stocks continued to set annual highs.