Intuitive Surgical Inc. (ISRG): Can Investors Rely On The Growth Led By Robotics Assisted Surgery?


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.

Intuitive Surgical

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.

Disclosure: none

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