In his show “Payne’s Picks” on Fox Business, Charles Payne discussed the shares of Intuitive Surgical Inc. (NASDAQ:ISRG) and how it’s robotic surgery methodology called the “da Vinci” Surgical System can prove to be positive for its stock going ahead.
Payne mentioned that Intuitive Surgical Inc. (NASDAQ:ISRG) has performed nearly 1.5 million surgical procedures using the da Vinci machine. As he described the machine, he said “execution has been inconsistent, including a huge mess last quarter”.
But he added:
“I think the efficacy problem will be resolved also. The value proposition in my mind is pretty clear to hospitals. You speak to anybody who works in a hospital. People Love it, partly because patients love non-invasive surgery.”
Payne said that the surgical procedures using the ‘da Vinci’ machine cover gynecology, general surgery, cardiac, etc. Intuitive Surgical Inc. (NASDAQ:ISRG) also introduced their fourth generation machine which got approved just last month only.
In addition to his positive comments, Payne said:
“There are a lot of critics out there; there are some lawsuits; one was dismissed this week.”
According to Payne, Japan and China will be playing a pivotal role in the growth of the company.
He said that though the stock looks expensive based on traditional valuation metrics, he is positive on ‘Intuitive Surgical Inc. (NASDAQ:ISRG)’ for the long term as hospitals would get more comfortable with the robotic surgical system going ahead. He expects the stock to rise by $56 going ahead.
Hetha Prabhakar, who is an author and retail analyst, added that the robotic surgery systems will be a $20 billion industry by 2020, going by the current pace of growth in adoption of robotics for surgery. Prabhakar said “so just don’t use (valuation) metrics alone, I feel like this is a stock to really invest in.”
In a nutshell, Payne is positive on the stock and its growth prospects for the long term. He admits that there is a risk involved, but also there is huge potential in the stock.
Orbimed Advisors, managed by Samuel Isaly raised its stake in Intuitive Surgical Inc. (NASDAQ:ISRG) by 351% in the first quarter to 336,300 shares worth. While Brian Taylor‘s Pine River Capital Management initiated a stake in Intuitive Surgical during the same period and now owns 265,817 shares.
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