Shares of companies that make orthopedic implants were mixed on Wednesday, but one analyst said a report from industry bellwether Biomet bodes well for the rest of the industry.
Biomet, which is privately held, reported sales for its fiscal second quarter on Wednesday. The company said revenue grew 8 percent in the three months ended Nov. 30, rising to $695.6 million. That included 15 percent growth in revenue from knee implants, an 8-percent gain in hip implant revenue, and a 29-percent jump in revenue from procedures on the extremities.
Total reconstructive revenue was up 9 percent to $528.4 million, Biomet said. Spinal revenue rose 7 percent, but fixation revenue slipped 2 percent and dental revenue decreased 5 percent. U.S. revenue rose 8 percent to $408.2 million and European sales grew 6 percent to $206.2 million. Other international sales rose 20 percent to $81.2 million.
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 Corp. 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 4 cents to $61.96 and Stryker stock rose 67 cents to $53.32. Both stocks continued to set annual highs.
Elsewhere, shares of Integra Lifescience Holdings Corp. added 51 cents to $38.93. Heart device maker Medtronic Inc. rose 69 cents to $45.28 and shares of spinal device maker Alphatec Holdings Inc. lost 20 cents, or 3.9 percent, to $4.93. Dental products company Align Technology Inc. slid 59 cents, or 3.3 percent, to $17.42, and Johnson & Johnson rose 44 cents to $64.37.