Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
Intuitive Surgical (ISRG) has been basing sideways for the better part of a month, but yesterday afternoon’s earnings report was the juice that finally got it going. Both a beat on earnings and an increase in revenue guidance. Of course buying and/or holding a large position into an earnings report is a major risk but for those who partook, it’s a nice reward today. That said, this is one of the most volatile and random stocks around earning reports that I’ve followed – sometimes you get the +8% and sometimes you get the -12%. More importantly for the long term, the company continues to maintain momentum – this is the classic razor + razor blade model that is quite rare.
Via IBD:
- The spread of robotic-assisted surgery to more medical procedures carried Intuitive Surgical well past Q1 profit and sales estimates, sending its shares sharply higher in late trading Tuesday. The medical robotics maker’s earnings rose 35% to $3.50 a share. Revenue climbed 28% to $495 million.
- Analysts polled by Thomson Reuters expected Intuitive Surgical to earn $3.14 a share on sales of $464.7 million.
- Intuitive Surgical also forecast 2012 sales will rise about 20% from 2011’s $1.76 billion. It had expected 17% to 19% growth.
- The company said da Vinci-assisted procedures grew 29% in Q1 from a year earlier.
- “Robotic hysterectomy is on track to generate nearly half of Intuitive’s total U.S. procedure growth target this year,” said William Blair analyst Ben Andrew.
- Intuitive gets about 44% of sales from system sales. Growth in operations performed with da Vinci systems is key, analysts say, because it gets about 40% of revenue from medical instruments and disposable accessories. Q1 system revenue rose 24% to $207 million. Instrument sales jumped 32% to $208 million.
- Sunnyvale, Calif.-based Intuitive Surgical’s robotic systems sell for an average $1.45 million. More than 2,130 of its systems are used in hospitals worldwide, about 72% of them in the U.S., 17% in Europe, and 6.5% in Asia.
- In Q1, Intuitive Surgical said it sold 140 robotic systems, up 17% from a year earlier. William Blair had expected 130 systems.
- With a new product in late 2011, Intuitive Surgical aims to expand robotics-assisted surgery to gallbladder operations and cardiac procedures, such as heart valve repairs. “Clearly they’re doing well getting da Vinci systems into more procedures,” said Michael Matson, analyst at Mizuho Securities. They’re making a push from specialty into more general surgery.
Disclosure Notice
Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the mutual fund he manages, the Paladin Long Short Fund (PALFX). For a list of the aforementioned fund’s holdings at the end of the prior quarter, visit the Paladin Funds website at http://www.paladinfunds.com/holdings/blog
