On Friday, RBC Capital Markets maintained its Outperform rating on shares of Intuitive Surgical (NASDAQ:) and increased the price target to $555.00, up from the previous $525.00. The adjustment follows Intuitive Surgical’s third-quarter 2024 earnings release, which revealed a 2% sales outperformance, primarily fueled by an 18% year-over-year growth in procedure volumes. This growth exceeded the consensus projection of 16%.
The company’s third-quarter performance was bolstered by higher-than-expected gross system placements, with 379 systems placed compared to the anticipated 326. Earnings per share (EPS) also surpassed expectations by 12%, attributed to efficient revenue conversion and robust margins.
Following these results, Intuitive Surgical’s management has revised its full-year guidance, increasing the lower end of its procedure volume forecast by 0.5 percentage points to a range of 16.0% to 17.0%. Moreover, the company has reduced its operational expenditure growth predictions by 0.5 percentage points, now expecting a 10-12% year-over-year increase.
A notable highlight from the report was the strong performance of the da Vinci 5 system placements, which reached 110 units, significantly surpassing RBC Capital Markets’ estimate of approximately 80. This performance is seen as a positive indicator for the company’s product uptake.
The upgraded price target reflects the firm’s confidence in Intuitive Surgical’s continued growth trajectory, supported by solid quarterly results and positive adjustments to the company’s financial guidance. RBC Capital Markets reiterates its Outperform rating, signaling its expectation that Intuitive Surgical will continue to perform well in the market.
In other recent news, Intuitive Surgical has reported robust third-quarter results for 2024, with a significant 18% rise 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%.
Mizuho Securities recently adjusted its outlook on Intuitive Surgical, increasing the price target to $550 from the previous $500, while maintaining a Neutral stance on the stock. This revision follows the company’s report of a $36 million and $0.20 earnings beat, driven by an 18% rise in procedure volumes and a significant increase in Da Vinci 5 system placements.
Despite ongoing pricing pressures in China due to value-based pricing adjustments and the introduction of domestic competitors, 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 further supported by real-time data from InvestingPro. The company’s market capitalization stands at an impressive $168.4 billion, reflecting its significant presence in the medical technology sector. Notably, Intuitive Surgical has demonstrated robust revenue growth, with a 14.47% increase in quarterly revenue as of Q2 2024, aligning with the article’s mention of the company’s sales outperformance.
InvestingPro Tips indicate that Intuitive Surgical is “trading near its 52-week high” and has shown a “high return over the last year,” with a one-year price total return of 71.94%. These metrics underscore the market’s positive reception of the company’s performance, particularly its strong procedure volume growth and system placements mentioned in the article.
The company’s profitability is also noteworthy, with InvestingPro data showing a healthy gross profit margin of 66.86% for the last twelve months as of Q2 2024. This aligns with the article’s mention of robust margins contributing to the company’s earnings outperformance.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Intuitive Surgical, providing deeper insights into the company’s financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
