Zacks – September 28, 2016
Share price of Intuitive Surgical Inc. ISRG rallied to a 52-week high of $720.94 on Sep 27, eventually closing a tad lower at $720.19. This represents a strong year-to-date return of about 31.86%, much better than the S&P 500’s return of 5.67% over the same time frame.
Currently, Intuitive Surgical carries a Zacks Rank #3 (Hold). The stock has a market cap of 27.22 billion and a long-term expected earnings growth rate of 11.26%.
Key Catalysts
We believe that growing adoption of Intuitive Surgical’s da Vinci system among physicians for general surgery, oncology, urology and gynecology procedures is a key growth catalyst. Moreover, increasing procedural volume outside the U.S. presents a significant growth opportunity for the company. Further, the integrated Table Motion product line has gained traction within a short span of time. This will likely boost top-line growth.
Meanwhile, increased spending on product development and higher investment in expanding the company’s footprint in international markets (particularly in Europe) are prudent moves to drive long-term growth.
Intuitive Surgical had impressed in the second quarter of 2016 with exceptional global procedure growth, solid capital placement, strong product margin and new product launches. Notably, the company reported adjusted earnings of $4.86 per share, which beat the Zacks Consensus Estimate by 65 cents.
