On Friday, Piper Sandler adjusted its stock price target for Intuitive Surgical (NASDAQ:ISRG), a leader in robotic-assisted surgery, to $538.00, up from the previous $495.00. The firm has maintained its Overweight rating on the company's shares.
This revision follows Intuitive Surgical's third-quarter results, which surpassed Wall Street's expectations in several key areas, including revenue, system placements, procedure growth, and adjusted earnings per share (EPS).
Intuitive Surgical's report highlighted a particularly robust quarter for its da Vinci surgical systems, with 110 new systems placed in the third quarter. The company is also on track for a broad launch of its next-generation system, the da Vinci 5 (DV5), anticipated in mid-2025. In addition, the company demonstrated financial leverage, posting an adjusted operating margin of 37.0%, which is significantly above the analyst's estimate of 33.3%.
The company has also revised its forecast for procedure growth, increasing the lower end of its full-year 2024 range to 16.0-17.0%, up from the previous forecast of 15.5-17.0%. This updated guidance reflects the company's strong performance and positive outlook.
Following the earnings report, Piper Sandler has raised its own revenue and adjusted EPS estimates for Intuitive Surgical, anticipating that other analysts will likely do the same. The firm's commentary suggests confidence in the company's continued growth and the potential for further financial upside.
In other recent news, Intuitive Surgical reported robust third-quarter results for 2024, with an 18% growth in DaVinci procedures and strong system placements. The company's revenue reached $2 billion, marking a 17% year-over-year increase.
The installed base of DaVinci systems grew to approximately 9,300 multi-port systems globally, with 379 systems placed in Q3. Intuitive Surgical also raised its full-year 2024 procedure growth forecast to a range of 16% to 17%.
RBC Capital Markets and Mizuho Securities have both adjusted their outlooks on Intuitive Surgical, raising their price targets following the company's strong earnings report. RBC Capital maintains an Outperform rating and increased the price target to $555, while Mizuho maintains a Neutral stance and raised the target to $550.
Despite facing pricing pressures in China, Intuitive Surgical anticipates a broad launch of DaVinci 5 by mid-2025 and is focusing on expanding the Ion system internationally, particularly in China and Europe. These are the recent developments for the company.
InvestingPro Insights
Intuitive Surgical's strong performance, as highlighted in the article, is reflected in several key metrics from InvestingPro. The company's revenue growth of 13.62% over the last twelve months and 14.47% in the most recent quarter aligns with the robust procedure growth mentioned in the report. This growth trajectory is further supported by an InvestingPro Tip indicating that ISRG has shown a "High return over the last year," with a impressive 71.94% price total return over the past year.
The company's financial leverage, noted in the article with an adjusted operating margin of 37.0%, is mirrored in InvestingPro data showing an operating income margin of 25.79% for the last twelve months. Another InvestingPro Tip points out that ISRG is "Trading near 52-week high," currently at 95.42% of its 52-week high price, which reflects the market's positive reception of the company's performance and outlook.
For investors seeking a deeper understanding of Intuitive Surgical's valuation and growth prospects, InvestingPro offers 13 additional tips not mentioned here. These insights could provide valuable context for the company's current market position and future potential.
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