Intuitive Surgical Is A Natural Buy
MarketBeat.com | Feb 07, 2022 06:31AM ET
Robotic surgery systems solutions provider Intuitive Surgical (NASDAQ:ISRG) stock is down (-18%) for the year robotic architecture and continues to grow sales at over 16% annually.
The Q4 2021 earnings results reflect the rebound of surgical procedures that were delayed during the pandemic lockdowns. Management has pointed out the 28% annual growth in da Vinci surgical procedures. The da Vinci robotic surgery system enables remote and robotically enhanced surgical procedures with more precision, accuracy, and control. The Company sells each system for $1.4 million each.
While the pandemic has bolstered the advent of remote work, da Vinci is a pioneer in the segment of remote surgeries. Nearly one in six surgeries are now assisted robotically. The Company continues to grow its user base and is introducing more applications to expand its depth of specialities.
Prudent investors seeking exposure in the healthcare technology segment should watch for opportunistic pullbacks in shares of Intuitive Surgical.
h2 Q4 Fiscal 2021 Earnings Release /h2On Jan. 20, 2022, Intuitive Surgical released its fiscal fourth-quarter 2021 results for the quarter ending December 2021. The Company reported an earnings-per-share (EPS) profit of $1.30 excluding non-recurring items versus consensus analyst estimates for a profit of $1.28, beating estimates by $0.02. Revenues grew by 16.6% year-over-year (YoY) to $1.55 billion matching analyst estimates for $1.55 billion. Worldwide sales of da Vinci systems rose 19% YoY driven by the growth in general surgery procedures. Total installed base of systems grew to 6,730, up 12% YoY.
h2 Conference Call Takeaways/h2Intuitive Surgical CEO Gary Guthart provided the details outlining the 28% YoY growth of da Vinci procedures. This reflects the recovery of surgical procedures. The Company added 1,700 new employees to its workforce in the past two years which include 700 workers outside of the U.S.
The Company is innovating with its Gen 4 architecture which includes significant improvements to energy and stapling products lines, endoscopic imaging, and the introduction of Extended Use instruments to Generation 4 fleets. Its Ion systems sell for $600,000 each with nearly 100 installed in 2021. Ion enables general, gynecological, urologic, cardiothoracic, and head and neck surgical procedures. The resulting outcome of enabling surgeons to operate with more accuracy and control leads to less complications and quicker recovery times.
CEO Guthart addressed its Ion systems,
“Turning to Ion. Our first indication addresses a large unmet need in lung cancer biopsy and our focus is fully enabling our production capability and customer ecosystem for this indication. There is strong demand for lung biopsy, and we are working to expand manufacturing capacity of all processes for greater quality and lower costs at scale and run trials and address regulatory requirements that enable global expansion. Over time, we plan for total Ion program profitability to approach that of our corporate average as we execute against our volume, design, and process improvement goals. We are pursuing additional applications for Ion, and we'll describe them as we get closer to market.”
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Using the rifle charts on the weekly and daily time frames provides a broader view of the landscape for ISRG stock. The weekly rifle chart peaked at a double top at the $369.82 Fibonacci (fib) level before plunging with the benchmark indexes through the $314.26 fib support. The weekly rifle chart downtrend has a falling 5-period moving average (MA) at $292.34 and lower Bollinger® Bands (BBs) at 259.36. The weekly stochastic formed divergence tops on each bounce attempt and finally fell through the 20-band.
The daily rifle chart triggered a market structure low (MSL) on the breakout above $268.40. The daily 5-period MA at $284.76 is crossing up through the daily 15-period MA at $283.85 attempting a breakout powered by the daily stochastic mini pup rebounding through the 20-band. The daily 200-period MA resistance at $322.20 nearly overlaps with the 50-period MA resistance at $239.39 with daily upper BBs at $354.96.
Prudent investors can watch for opportunistic pullback levels at the $276.80 fib, $268.29 fib, $256.70 fib, $245.67 fib, $235.58 fib, $231.81 fib, $224.14 fib, and the $219.65 fib level. Upside trajectories range from the $320.80 fib up towards the $383.04 fib level.
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