Medical Equipment Companies Meeting Berkshire Hathaway Acquisition Criteria: Covidien Ltd. (COV) , St. Jude Medical Inc. (STJ) , Zimmer Holdings Inc. (ZMH)
On March 19, Bloomberg reported that Warren Buffett, Chairman and CEO of Berkshire Hathaway, is seeking to spend $5 billion to $20 billion on an acquisition. He prefers “simple” businesses with pretax profit exceeding $75 million, “consistent earnings power,” “good” returns on equity and little or no debt. Bloomberg went on and stated that there are 50 U.S. companies with that much market value and profit, a return on equity exceeding 10 percent and a debt-to- equity ratio less than 50 percent, according to Bloomberg’s own data.
It is fool’s game to speculate on which of the 50 companies that Berkshire Hathaway will acquire. Each company has to stand on its own investment merit regardless what Warren Buffett may or may not make a move on it.
GuruFocus dug into the list of companies and present information on company’s business, ownership of the Investment Gurus, and trade activity of insiders. The companies are grouped according to industries they operate in. This part we treat threee medical equipment companies: Covidien Ltd. (COV) , St. Jude Medical Inc. (STJ) , Zimmer Holdings Inc. (ZMH)
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