Zimmer’s outlook was slightly worse than Wall Street expected when they announced results and held their conference call, but the general picture for the company remains more or less unchanged.  They made progress in the fourth quarter on fixing the problems that we knew were there (both manufacturing and doctor relationship problems), so they are on the right side of the issues and working to rebuild their business.

The hope is that their traditional strength and leadership in innovative orthopedic products, particularly in knees but also in hips, will let them regain the lost traction they’ve seen in the marketplace over the past year.  I think they’re doing the right things, and they’re giving guidance for this year’s earnings that continue to place the company at roughly a 10 forward PE ratio, so the price remains reasonable.

If you’re interested in this company, or you own shares, you should certainly read the transcript of the conference cal — it’s available here.