Medtronic plc and Zimmer Biomet Holdings, Inc. are two prominent players in the medical devices industry, each with a strong presence in innovative healthcare solutions. While Medtronic offers a broad portfolio including cardiovascular and diabetes products, Zimmer Biomet focuses on musculoskeletal and orthopedic innovations. This article will help you, the investor, navigate their strengths and risks to identify the most promising stock for your portfolio.
Table of contents
Companies Overview
I will begin the comparison between Medtronic plc and Zimmer Biomet Holdings, Inc. by providing an overview of these two companies and their main differences.
Medtronic Overview
Medtronic plc develops, manufactures, and sells device-based medical therapies globally, serving healthcare systems, physicians, and patients. Its product portfolio spans cardiovascular, medical surgical, neuroscience, and diabetes segments, offering advanced devices such as implantable cardiac equipment, surgical robotics, and insulin pumps. Founded in 1949 and headquartered in Dublin, Ireland, Medtronic operates with 95,000 employees and is a major player in the medical devices industry.
Zimmer Biomet Overview
Zimmer Biomet Holdings, Inc. focuses on musculoskeletal healthcare, designing and marketing orthopedic reconstructive products including knee, hip, spine, and dental implants. The company serves various medical specialists and healthcare organizations worldwide. Founded in 1927 and based in Warsaw, Indiana, Zimmer Biomet employs 17,000 people and emphasizes solutions for bone and joint disorders, trauma, and surgical reconstruction.
Key similarities and differences
Both Medtronic and Zimmer Biomet operate in the medical devices sector with a focus on improving patient outcomes through innovative therapies. Medtronic offers a broader portfolio, including cardiovascular and diabetes devices, while Zimmer Biomet specializes in orthopedic and dental reconstructive products. Medtronic’s scale is significantly larger, reflected in its workforce and market capitalization, whereas Zimmer Biomet maintains a focused approach within musculoskeletal healthcare.
Income Statement Comparison
Below is the latest fiscal year income statement comparison for Medtronic plc and Zimmer Biomet Holdings, Inc., highlighting key financial metrics.
| Metric | Medtronic plc (MDT) | Zimmer Biomet Holdings, Inc. (ZBH) |
|---|---|---|
| Market Cap | 125B | 18.4B |
| Revenue | 33.5B | 7.68B |
| EBITDA | 9.22B | 2.25B |
| EBIT | 6.36B | 1.25B |
| Net Income | 4.66B | 904M |
| EPS | 3.63 | 4.45 |
| Fiscal Year | 2025 | 2024 |
Income Statement Interpretations
Medtronic plc
Medtronic’s revenue grew steadily from $30.1B in 2021 to $33.5B in 2025, with net income rising from $3.6B to $4.7B. Margins have improved overall, with gross margin at 65.3% and net margin at 13.9%. In 2025, revenue growth slowed to 3.6%, but EBIT and net margin expanded significantly, indicating enhanced profitability and operational efficiency.
Zimmer Biomet Holdings, Inc.
Zimmer Biomet’s revenue increased from $6.1B in 2020 to $7.7B in 2024 alongside net income, which surged from a loss of $139M in 2020 to $904M in 2024. The company maintains a high gross margin of 71.5% but saw a decline in EBIT and net margin growth in the latest year. Operating expenses outpaced revenue growth, pressuring recent profitability.
Which one has the stronger fundamentals?
Medtronic demonstrates consistent revenue and net income growth with favorable margin expansions and improving profitability metrics, reflecting stable fundamentals. Zimmer Biomet shows strong long-term gains but recent operating challenges and margin contractions raise caution. Overall, Medtronic’s income statement reveals a more balanced and resilient financial performance based on the latest data.
Financial Ratios Comparison
This table presents the most recent key financial ratios for Medtronic plc and Zimmer Biomet Holdings, Inc., allowing a side-by-side comparison of their fiscal year 2025 and 2024 performances respectively.
| Ratios | Medtronic plc (FY 2025) | Zimmer Biomet Holdings, Inc. (FY 2024) |
|---|---|---|
| ROE | 9.7% | 7.2% |
| ROIC | 6.1% | 5.7% |
| P/E | 23.4 | 23.7 |
| P/B | 2.27 | 1.72 |
| Current Ratio | 1.85 | 1.91 |
| Quick Ratio | 1.42 | 0.99 |
| D/E (Debt-to-Equity) | 0.59 | 0.50 |
| Debt-to-Assets | 31.1% | 29.0% |
| Interest Coverage | 8.2 | 5.9 |
| Asset Turnover | 0.37 | 0.36 |
| Fixed Asset Turnover | 4.91 | 3.75 |
| Payout Ratio | 77.0% | 21.7% |
| Dividend Yield | 3.29% | 0.91% |
Interpretation of the Ratios
Medtronic plc
Medtronic shows a balanced ratio profile with favorable net margin (13.9%) and interest coverage (8.72), supported by a strong current ratio (1.85) and quick ratio (1.42). However, its return on equity (9.71%) and asset turnover (0.37) are less impressive, indicating some operational efficiency concerns. The dividend yield at 3.29% is favorable, suggesting reliable shareholder returns.
Zimmer Biomet Holdings, Inc.
Zimmer Biomet presents a slightly favorable ratio set with a decent net margin (11.77%) and solid interest coverage (5.76). Its debt-to-equity (0.5) and debt-to-assets (29.04%) ratios are favorable, but the quick ratio (0.99) and dividend yield (0.91%) are less strong. The return on equity (7.25%) and asset turnover (0.36) remain points of caution for investors.
Which one has the best ratios?
Both companies exhibit slightly favorable overall ratio profiles with 50% favorable ratios each. Medtronic holds an edge in dividend yield and interest coverage, while Zimmer Biomet demonstrates better leverage ratios. Despite some unfavorable metrics for both, neither shows a clear superiority, reflecting balanced financial health with distinct strengths and weaknesses.
Strategic Positioning
This section compares the strategic positioning of Medtronic plc and Zimmer Biomet Holdings, Inc., focusing on market position, key segments, and exposure to technological disruption:
Medtronic plc
- Large market cap of 125B with diversified medical device portfolio under competitive pressure.
- Key segments include Cardiovascular, Diabetes, Medical Surgical, and Neuroscience groups.
- Invests in advanced surgical AI, robotic-assisted surgery, and remote patient monitoring systems.
Zimmer Biomet Holdings, Inc.
- Smaller market cap of 18B, focused on musculoskeletal healthcare and orthopedics.
- Key segments are Hips, Knees, Sports Medicine, and Other orthopaedic product lines.
- Offers robotic, surgical, and bone cement products, with emphasis on orthopedics.
Medtronic plc vs Zimmer Biomet Holdings, Inc. Positioning
Medtronic pursues a diversified strategy across several medical device areas, providing multiple growth drivers but facing broad competition. Zimmer Biomet concentrates on musculoskeletal and orthopedic products, allowing focused expertise but narrower market exposure.
Which has the best competitive advantage?
Both companies have a slightly unfavorable moat with ROIC below WACC yet show growing profitability trends, indicating value destruction but improving operational efficiency without a clear superior competitive advantage.
Stock Comparison
The stock price movements of Medtronic plc (MDT) and Zimmer Biomet Holdings, Inc. (ZBH) over the past year reveal divergent trading dynamics, with MDT showing a marked upward trajectory and ZBH experiencing a sustained decline.
Trend Analysis
Medtronic plc’s stock exhibited a bullish trend over the past 12 months with a 15.53% price increase, accelerating upward from a low of 77.61 to a high of 105.33, supported by moderate volatility (std deviation 5.91).
Zimmer Biomet’s stock demonstrated a bearish trend with a 25.55% price decline over the same period, decelerating from a high of 131.98 to a low of 88.5, accompanied by higher volatility (std deviation 10.3).
Comparing both, Medtronic delivered the highest market performance with sustained gains, while Zimmer Biomet faced significant losses and greater price fluctuation during the past year.
Target Prices
The current analyst consensus indicates moderate upside potential for both Medtronic plc and Zimmer Biomet Holdings, Inc.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Medtronic plc | 120 | 103 | 111.67 |
| Zimmer Biomet Holdings, Inc. | 130 | 93 | 108.91 |
Analysts expect Medtronic’s stock to rise from $97.53 to around $111.67 on average, while Zimmer Biomet shows a similar expected increase from $92.85 to $108.91. These targets suggest moderate growth relative to current prices.
Analyst Opinions Comparison
This section compares analysts’ ratings and grades for Medtronic plc and Zimmer Biomet Holdings, Inc.:
Rating Comparison
MDT Rating
- Rating: B, considered very favorable overall.
- Discounted Cash Flow Score: 4, indicating favorable valuation based on cash flow.
- ROE Score: 3, showing moderate efficiency in generating profit from equity.
- ROA Score: 4, favorable asset utilization for earnings.
- Debt To Equity Score: 1, very unfavorable, indicating high financial risk.
- Overall Score: 3, moderate overall financial standing.
ZBH Rating
- Rating: B+, also very favorable overall.
- Discounted Cash Flow Score: 5, reflecting very favorable valuation on cash flow.
- ROE Score: 3, also moderate efficiency in profit generation from equity.
- ROA Score: 3, moderate effectiveness in utilizing assets for earnings.
- Debt To Equity Score: 1, equally very unfavorable financial risk.
- Overall Score: 3, also moderate overall financial standing.
Which one is the best rated?
Zimmer Biomet holds a slightly better rating of B+ compared to Medtronic’s B. Zimmer Biomet scores higher on discounted cash flow and price-to-book metrics, while both share similar overall scores and risk profiles, indicating a close comparison in analyst evaluations.
Scores Comparison
This section compares the Altman Z-Score and Piotroski Score of Medtronic plc and Zimmer Biomet Holdings, Inc.:
MDT Scores
- Altman Z-Score: 3.20, indicating a safe zone with low bankruptcy risk.
- Piotroski Score: 7, reflecting strong financial health and value potential.
ZBH Scores
- Altman Z-Score: 1.84, placing it in the grey zone with moderate bankruptcy risk.
- Piotroski Score: 8, showing very strong financial health and investment quality.
Which company has the best scores?
Based on the provided data, MDT has a safer Altman Z-Score, while ZBH scores higher on the Piotroski scale. ZBH’s very strong Piotroski score slightly edges out MDT’s strong rating, despite MDT’s better bankruptcy risk score.
Grades Comparison
The following presents the recent grades and rating trends for Medtronic plc and Zimmer Biomet Holdings, Inc.:
Medtronic plc Grades
This table summarizes recent grading company actions and grade changes for Medtronic plc.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Bernstein | Maintain | Outperform | 2026-01-09 |
| Barclays | Maintain | Overweight | 2026-01-08 |
| William Blair | Upgrade | Outperform | 2026-01-06 |
| Truist Securities | Maintain | Hold | 2025-12-18 |
| Truist Securities | Maintain | Hold | 2025-11-20 |
| Barclays | Maintain | Overweight | 2025-11-20 |
| UBS | Maintain | Neutral | 2025-11-19 |
| Morgan Stanley | Maintain | Overweight | 2025-11-19 |
| Goldman Sachs | Upgrade | Neutral | 2025-11-19 |
| Wells Fargo | Maintain | Overweight | 2025-11-19 |
Medtronic’s grades show a predominantly positive outlook with multiple “Outperform” and “Overweight” ratings and several maintained or upgraded positions.
Zimmer Biomet Holdings, Inc. Grades
This table provides recent grading company actions and grade changes for Zimmer Biomet Holdings, Inc.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Bernstein | Maintain | Market Perform | 2026-01-09 |
| BTIG | Maintain | Buy | 2026-01-08 |
| Evercore ISI Group | Upgrade | Outperform | 2026-01-05 |
| Baird | Downgrade | Neutral | 2025-12-16 |
| Citigroup | Maintain | Neutral | 2025-12-11 |
| Canaccord Genuity | Maintain | Hold | 2025-11-10 |
| UBS | Maintain | Sell | 2025-11-06 |
| RBC Capital | Maintain | Outperform | 2025-11-06 |
| Barclays | Maintain | Underweight | 2025-11-06 |
| JP Morgan | Downgrade | Neutral | 2025-11-06 |
Zimmer Biomet’s ratings are mixed, with recent downgrades and some “Neutral” and “Hold” ratings, alongside a few “Outperform” and “Buy” grades.
Which company has the best grades?
Medtronic plc holds better grades overall, with a stronger consensus and more frequent “Outperform” and “Overweight” ratings. Zimmer Biomet’s ratings are more varied and include downgrades, which may indicate greater uncertainty for investors compared to Medtronic.
Strengths and Weaknesses
Below is a comparative overview of key strengths and weaknesses for Medtronic plc (MDT) and Zimmer Biomet Holdings, Inc. (ZBH), based on recent financial and operational data.
| Criterion | Medtronic plc (MDT) | Zimmer Biomet Holdings, Inc. (ZBH) |
|---|---|---|
| Diversification | Highly diversified with 4 major segments: Cardiac & Vascular (12.5B), Neuroscience (9.8B), Medical Surgical (8.4B), Diabetes (2.8B) | Moderately diversified focusing on Orthopedics: Knees (3.17B), Hips (2.0B), S E T (1.87B), Other (0.64B) |
| Profitability | Net margin 13.9% (favorable), ROIC 6.08% (neutral), ROE 9.71% (unfavorable) | Net margin 11.77% (favorable), ROIC 5.68% (neutral), ROE 7.25% (unfavorable) |
| Innovation | Strong innovation pipeline, supported by growing ROIC trend (+23%) but currently shedding value (ROIC < WACC by 0.35%) | Innovation evident with very strong ROIC growth (+17,367%) but still shedding value (ROIC < WACC by 0.11%) |
| Global presence | Extensive global footprint across multiple therapy areas | Strong global presence in orthopedics but narrower therapy focus compared to MDT |
| Market Share | Leading market shares in cardiac devices and neuroscience | Leading position in orthopedic implants, particularly knees and hips |
Key takeaways: Both Medtronic and Zimmer Biomet demonstrate strong diversification and favorable net margins. They exhibit growing profitability trends despite currently shedding economic value. Medtronic offers broader diversification, while Zimmer Biomet shows explosive ROIC growth in its niche. Caution is advised due to their economic moat status being slightly unfavorable.
Risk Analysis
Below is a comparison of key risks for Medtronic plc (MDT) and Zimmer Biomet Holdings, Inc. (ZBH) based on the most recent data available:
| Metric | Medtronic plc (MDT) | Zimmer Biomet Holdings, Inc. (ZBH) |
|---|---|---|
| Market Risk | Beta 0.73, moderate sensitivity to market swings | Beta 0.61, slightly lower market volatility |
| Debt Level | Debt-to-Equity ratio 0.59 (neutral), debt-to-assets 31.1% | Debt-to-Equity ratio 0.50 (favorable), debt-to-assets 29.0% |
| Regulatory Risk | High, given global medical device regulations and ongoing compliance demands | High, with exposure to orthopedic and surgical device regulations worldwide |
| Operational Risk | Large, complex product portfolio with potential supply chain and innovation challenges | Moderate, focused product lines but reliant on surgical and orthopedics markets |
| Environmental Risk | Moderate, with increasing pressure on sustainability in healthcare manufacturing | Moderate, with efforts to reduce environmental footprint in production |
| Geopolitical Risk | Elevated, due to global operations and exposure to currency, trade policies | Elevated, primarily US-based but with international markets exposure |
In synthesis, both companies face notable regulatory and geopolitical risks due to their global medical device operations. Zimmer Biomet’s lower debt levels and stronger Piotroski score (8 vs. 7) suggest better financial resilience, though its Altman Z-Score sits in the grey zone, indicating moderate bankruptcy risk. Medtronic’s safer Altman Z-Score and larger scale provide stability but with slightly higher operational complexity. Investors should weigh regulatory compliance and global market risks carefully when considering these stocks.
Which Stock to Choose?
Medtronic plc (MDT) shows a favorable income evolution with strong growth in net margin (13.9%) and EPS over 2021–2025. Its financial ratios are slightly favorable, highlighting solid liquidity and dividend yield, though ROE is unfavorable. The company carries moderate debt and holds a very favorable rating grade B.
Zimmer Biomet Holdings, Inc. (ZBH) displays a favorable but less consistent income profile, with mixed recent growth and a net margin of 11.77%. Its financial ratios are slightly favorable overall, with strong debt management but weaker profitability metrics. The company’s debt level is moderate, and it holds a very favorable rating grade B+.
Investors seeking growth may find Medtronic’s improving profitability and higher dividend yield appealing, while those valuing financial stability with moderate debt might view Zimmer Biomet as suitable. Both have slightly unfavorable moats, indicating value destruction despite growing ROIC, suggesting careful risk assessment is advisable.
Disclaimer: Investment carries a risk of loss of initial capital. The past performance is not a reliable indicator of future results. Be sure to understand risks before making an investment decision.
Go Further
I encourage you to read the complete analyses of Medtronic plc and Zimmer Biomet Holdings, Inc. to enhance your investment decisions:
