15 Small-Cap Healthcare Stocks Hedge Funds Are Buying

7. Zimmer Biomet Holdings, Inc. (NYSE:ZBH)

No. of Hedge Fund Holders: 53

Market Capitalization: $19.29 Billion

Analyst Upside: 6.68%

Zimmer Biomet Holdings, Inc. (NYSE:ZBH) is a global medical device technology company. The company operates through four main segments: the Americas, Europe, the Middle East and Africa (EMEA), and Asia Pacific. Zimmer Biomet designs, manufactures, and markets orthopaedic reconstructive products. The company offers several other products, including biologics, sports medicine, dental implants, trauma products, and related surgical equipment. ZBH maintains a healthy share of 36% in knee implants, leading the orthopaedic sector. It has a 23% share in hip implants.

Zimmer Biomet Holdings, Inc. (NYSE:ZBH) posted a modest 1.1% revenue growth of $1.91 billion during Q1 2025, surpassing estimates by $13.77 million. The increase in revenue was driven by strong performance in U.S. Hips and mid-single-digit growth in S.E.T. For the full year 2025, the company expects the revenue to grow between 3% and 5% on constant currency, excluding the Paragon 28 acquisition.

On May 6, David Roman from Goldman Sachs reduced the price target on ZBH from $120 to $104, keeping a Neutral rating on the shares. The analyst has reduced the price following a lower earnings outlook for 2025. The company updated its 2025 adjusted earnings guidance of $7.90 to $8.10, reducing from the previous guidance of $8.15 to $8.35. The company is expected to face a $60 million to $80 million headwind from tariffs in 2025. Despite the short-term headwinds, Zimmer Biomet Holdings is working on innovation and diversification, with new product launches including the Iodine-Surface-Treated Hip Stem and the Oxford partial Cementless Knee. The company is also focused on its U.S. sales channel and optimizing its ASC offerings and robotic platforms.