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Here's Why You Should Retain Intuitive Surgical (ISRG) Stock
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Intuitive Surgical, Inc. (ISRG - Free Report) is well-poised for growth on the improving adoption of the da Vinci Surgical System and a strong international presence. However, an increase in output costs remains a headwind.
Shares of this Zacks Rank #3 (Hold) company have lost 29.4% compared with the industry’s decline of 23.8% in a year’s time. The S&P 500 Index has declined 12% in the same time frame.
ISRG — with a market capitalization of $72.53 billion — designs, manufactures and markets the da Vinci surgical system along with related instruments and accessories. The da Vinci surgical system is an advanced robot-assisted surgical system. The company anticipates earnings to improve 10% over the next five years. It beat earnings estimates in three of the trailing four quarters and matched once, the average surprise being 7.8%.
What’s Favoring the Stock?
Intuitive Surgical’s robot-based da Vinci surgical system enables minimally-invasive surgery that reduces risks associated with open surgery. The company continues to gain from this system, which in turn bolsters overall performance.
Intuitive Surgical set up 6,920 da Vinci surgical systems in the first quarter of 2022, with the installed base growing 12.7% year over year. For 2022, the company now projects procedure growth of 12-16% (up from the prior range of 11-15%). This estimate takes into account the uncertainty related to the pandemic.
With respect to digital capabilities, the company remains focused on improving the ecosystem. On the first-quarter 2022 earnings call, the company stated that the My Intuitive app (which enables surgeons to manage their da Vinci experience, log into da Vinci systems, manage their training and view their operative data from the palm of their hand) community tripled on a year-over-year basis. The app is currently available in the United States, Japan, Germany, France, the U.K. and Ireland, and Switzerland.
Intuitive Surgical’s teams in Israel and the United States have developed Intuitive Hub on the back of its Orpheus technology. Intuitive Hub — a unified hardware and software solution for the operating room — allows OR teams to capture, edit and share video clips from clinical procedures and partner virtually by utilizing existing workflows and intuitive systems. In the first quarter, the company introduced an upgraded interface to the da Vinci systems that enable automated video capture with integrated procedure annotation for key events, thereby building convenient video storage and review for event cases.
Image Source: Zacks Investment Research
The recent FDA clearance for the integration of mobile cone-beam CT (CBCT) imaging technology with its minimally-invasive, robotic-assisted bronchoscopy system, Ion Endoluminal System is likely to benefit the company as it will allow biopsy of small and difficult-to-access lesions in the lung as well as biopsy of peripheral lung and provide the necessary stability for precision in a biopsy.
In the first quarter of 2022, outside the United States, revenues totaled $522.9 million, up 17.6% on a year-over-year basis. This was driven by substantial growth in procedure volume. Outside the United States, Intuitive Surgical placed 125 systems in the first quarter compared with 108 in the prior-year quarter. Of these, 78 were in Europe, 19 in Japan and nine in China.
What’s Weighing on the Company?
The COVID-19 pandemic adversely impacted the global supply of semiconductors and other materials utilized in Intuitive Surgical’s products. Although the company has been making every effort to secure the supply required to ensure the fulfillment of consumer demand, global shortages might result in higher output costs or delay in production.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $6.37 billion, suggesting growth of 11.52% from the year-ago reported number, while the same for earnings stands at $4.81 per share, indicating a decline of 3%.
Stocks to Consider
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Patterson Companies, Inc. (PDCO - Free Report) and ShockWave Medical, Inc. .
AMN Healthcare, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 1.1%. AMN’s earnings surpassed the Zacks Consensus Estimate in all four trailing quarters, the average being 15.6%.
AMN Healthcarehas gained 13.8% against the industry’s 32.7% fall in the past year.
Patterson Companies, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 9.6%. PDCO’s earnings surpassed estimates in all the trailing four quarters, the average being 16.5%.
Patterson Companies has lost 1.8% compared with the industry’s 10.5% fall over the past year.
ShockWave Medical, sporting a Zacks Rank of 1 at present, has an estimated growth rate of 44.9% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average being 189.9%.
ShockWave Medical has gained 7.9% against the industry’s 24.4% fall over the past year.
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Here's Why You Should Retain Intuitive Surgical (ISRG) Stock
Intuitive Surgical, Inc. (ISRG - Free Report) is well-poised for growth on the improving adoption of the da Vinci Surgical System and a strong international presence. However, an increase in output costs remains a headwind.
Shares of this Zacks Rank #3 (Hold) company have lost 29.4% compared with the industry’s decline of 23.8% in a year’s time. The S&P 500 Index has declined 12% in the same time frame.
ISRG — with a market capitalization of $72.53 billion — designs, manufactures and markets the da Vinci surgical system along with related instruments and accessories. The da Vinci surgical system is an advanced robot-assisted surgical system. The company anticipates earnings to improve 10% over the next five years. It beat earnings estimates in three of the trailing four quarters and matched once, the average surprise being 7.8%.
What’s Favoring the Stock?
Intuitive Surgical’s robot-based da Vinci surgical system enables minimally-invasive surgery that reduces risks associated with open surgery. The company continues to gain from this system, which in turn bolsters overall performance.
Intuitive Surgical set up 6,920 da Vinci surgical systems in the first quarter of 2022, with the installed base growing 12.7% year over year. For 2022, the company now projects procedure growth of 12-16% (up from the prior range of 11-15%). This estimate takes into account the uncertainty related to the pandemic.
With respect to digital capabilities, the company remains focused on improving the ecosystem. On the first-quarter 2022 earnings call, the company stated that the My Intuitive app (which enables surgeons to manage their da Vinci experience, log into da Vinci systems, manage their training and view their operative data from the palm of their hand) community tripled on a year-over-year basis. The app is currently available in the United States, Japan, Germany, France, the U.K. and Ireland, and Switzerland.
Intuitive Surgical’s teams in Israel and the United States have developed Intuitive Hub on the back of its Orpheus technology. Intuitive Hub — a unified hardware and software solution for the operating room — allows OR teams to capture, edit and share video clips from clinical procedures and partner virtually by utilizing existing workflows and intuitive systems. In the first quarter, the company introduced an upgraded interface to the da Vinci systems that enable automated video capture with integrated procedure annotation for key events, thereby building convenient video storage and review for event cases.
Image Source: Zacks Investment Research
The recent FDA clearance for the integration of mobile cone-beam CT (CBCT) imaging technology with its minimally-invasive, robotic-assisted bronchoscopy system, Ion Endoluminal System is likely to benefit the company as it will allow biopsy of small and difficult-to-access lesions in the lung as well as biopsy of peripheral lung and provide the necessary stability for precision in a biopsy.
In the first quarter of 2022, outside the United States, revenues totaled $522.9 million, up 17.6% on a year-over-year basis. This was driven by substantial growth in procedure volume. Outside the United States, Intuitive Surgical placed 125 systems in the first quarter compared with 108 in the prior-year quarter. Of these, 78 were in Europe, 19 in Japan and nine in China.
What’s Weighing on the Company?
The COVID-19 pandemic adversely impacted the global supply of semiconductors and other materials utilized in Intuitive Surgical’s products. Although the company has been making every effort to secure the supply required to ensure the fulfillment of consumer demand, global shortages might result in higher output costs or delay in production.
Estimates Trend
The Zacks Consensus Estimate for 2022 revenues is pegged at $6.37 billion, suggesting growth of 11.52% from the year-ago reported number, while the same for earnings stands at $4.81 per share, indicating a decline of 3%.
Stocks to Consider
Some better-ranked stocks from the broader medical space are AMN Healthcare Services, Inc. (AMN - Free Report) , Patterson Companies, Inc. (PDCO - Free Report) and ShockWave Medical, Inc. .
AMN Healthcare, sporting a Zacks Rank #1 (Strong Buy) at present, has an estimated long-term growth rate of 1.1%. AMN’s earnings surpassed the Zacks Consensus Estimate in all four trailing quarters, the average being 15.6%.
You can see the complete list of today’s Zacks #1 Rank stocks here.
AMN Healthcarehas gained 13.8% against the industry’s 32.7% fall in the past year.
Patterson Companies, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 9.6%. PDCO’s earnings surpassed estimates in all the trailing four quarters, the average being 16.5%.
Patterson Companies has lost 1.8% compared with the industry’s 10.5% fall over the past year.
ShockWave Medical, sporting a Zacks Rank of 1 at present, has an estimated growth rate of 44.9% for 2023. SWAV’s earnings surpassed estimates in all the trailing four quarters, the average being 189.9%.
ShockWave Medical has gained 7.9% against the industry’s 24.4% fall over the past year.