Intuitive Surgical Gains After Earnings Surge

Intuitive Surgical Gains After Earnings Surge

Intuitive Surgical (NASDAQ:ISRG), makers of the da Vinci surgical robot, surged ahead around 3% in premarket trading today. The company lost some of those gains going into the morning's trading session as profit-taking likely kicked in. Sales of the da Vinci led the way for the company, and increasingly positive word from the financial analyst community underscores recent gains.

Intuitive Surgical's Robotic Platform Drives Big Growth

Intuitive Surgical's earnings report featured wins all around, as the company posted adjusted earnings of $3.92 per share against a consensus estimate calling for $3.07. It also beat the somewhat higher Zacks Consensus Estimate of $3.16. Better yet, generally accepted accounting principles (GAAP) earnings per share figures came in at $4.25 for the quarter, which compares magnificently against this time last year, when the company posted $0.57 for the quarter.

The Instruments and Accessories sector delivered the best growth, featuring an improvement over last year of 72.8%, reaching a total of $796.4 million by itself. Reports peg this directly to a 68% growth in procedures conducted by da Vinci surgical devices, which corresponds to a general reopening of hospitals for anything other than Covid-related issues. Systems, meanwhile, contributed $439.6 million, up 68.4% against this time last year. Even the company's Services sector was a significant contributor, bringing in $228 million, which was up almost 75% from the same time in 2020.

In perhaps the clearest sign of the company's overall performance, Intuitive Surgical shipped 328 da Vinci systems for the quarter, as compared to 178 in the quarter a year prior. The company's performance internationally also delivered high notes, as the company brought in $458.2 million from operations outside the United States. That represented a 44.7% increase against this time last year.

As for what may be the company's only low point in the ISRG earnings report, it would not issue any guidance for 2021. This is due to the ongoing uncertainty surrounding the Covid-19 pandemic and the overall rate of recovery for the global economy. Additionally, reports of rising production costs and the risk of adopting robotic surgical procedures are seen as potential downsides to the company's future performance. If hospitals and other medical operations overcome that risk, however, the company's substantial strength in robotics will make it a major part of the market. This is a point echoed elsewhere in the market; Johnson & Johnson (NYSE:JNJ) recently revised its guidance upward after raising its full-year guidance, partially on the strength of improving sales in the medical device sector.

How Do Financial Analysts Feel About Intuitive Surgical Stock?

Intuitive Surgical recently hit a 52-week high, when it reached $949.29 back on July 6. It slipped back from that just a bit to close that day's session, but so far this year the company has gained 63.2%. That by itself means there's plenty of investor interest, and that's a sentiment echoed by financial analysts. ISRG stock currently carries a consensus rating of “buy”, which it's held since March 2021, after upgrading from “hold”.

A year ago, the company had 11 “buy” ratings, nine “hold” and two “sell” to its credit. Six months ago, that shifted slightly to 11 “buy”, eight “hold” and two “sell.” Today, however, things are substantially different as we have 10 “buy” ratings and nine “hold”. The sell side has departed the field altogether, making the “buy” recommendation that much clearer in response.

There's a fairly broad depth of field when it comes to Intuitive Surgical stock price targets as well; the current average is $878.83, with a high of $1,100 and a low of $410. Recent developments in the price target field have been overwhelmingly positive, however; earlier today, six analysts raised their price targets on Intuitive Surgical. Citigroup (NYSE:C) actually established that new high target of $1,100 today. The six raised targets join two hikes from Goldman Sachs (NYSE:GS) and Stifel Nicolaus just last week, and several hiked targets from earlier this year.

Companies in This Article:

CompanyCurrent PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Intuitive Surgical (ISRG)$1,037.27flatN/A77.52Hold$952.81