Our previous article on Zimmer Biomet (ZBH) was bullish. In short, we considered that the cheap valuation did reflect company-specific issues but was not structural. Indeed, the implants industry benefits from structural growth drivers such as an ageing population or a high prevalence of obesity as well as attractive features such as price discipline among players and high client switching costs (leading to sticky market share). Besides, all players were doing well suggesting that Zimmer suffered from mismanagement. We were convinced (and still are) that all these quality/supply issues could be overcome