Shares of Zimmer Holdings (NYSE:ZMH) were off about 3% on Wall Street today, as the Warsaw, Ind.-based medical device company trimmed its 2012 sales outlook and showed some softness in sales of knee and hip implants.
Zimmer officials reported $1.13 billion in sales during the 3-month-period ended on June 30, down 1% from the $1.14 billion the company posted last year. Net income was up about 5 percent to $214.5 million, compared to $203.8 million for the same period last year.
The company’s reconstructive business, which includes its knee, hip and extremities product lines came in at $843.2 million, down 2% from the $856.6 million from the same period last year. Most of the decline came from softness in the EU market, which was off 6%.
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While U.S. sales were positive for Zimmer, The Street reacted negatively, perhaps due to hightened expectations from a positive earnings note last week from cross-town rival Biomet. Considered a beacon of larger trends in orthopedics, Biomet said it expected to report a 7% increase in U.S. sales and a 12% increase in international sales for the 4th quarter. That news sent shares of several orthopedic stocks up, including Zimmer’s, which saw a 2.4% spike following Biomet’s earnings.
Zimmer also revised its year-end outlook for 2012, narrowing its full-year top-line growth to between 2.5% and 3.5%. Earlier forecasts predicted 2% to 4% growth.
The company also lowered its earnings forecast to $4.75-$4.85 on a reported basis and $5.25-$5.35 on an adjusted basis. Prior guidance for full-year 2012 reported and adjusted diluted earnings per share was $4.70-$4.90 and $5.20-$5.40, respectively.
Analysts, on average, expect full-year earnings of $5.27 per share, on $4.53 billion in sales.
Shares of Zimmer were trading at $59.15 through midday trading, down 3% from an opening price of $59.58.
