Intuitive Surgical Soars On Stellar Q1 Results: Analysts Boost Price Targets Amid Robust Procedure Growth

Shares of Intuitive Surgical, Inc. ISRG surged in after-hours trading on Tuesday, following the release of the company’s upbeat results for the first quarter.

RBC Capital Markets On Intuitive Surgical

Analyst Shagun Singh maintained an Outperform rating, while raising the price target from $305 to $309.

“ISRG reported Q1’23 revenue that beat consensus estimates due to strong procedure volumes (+26% y/y) and higher system placements,” Singh said in a note. “ISRG raised its FY23 procedure volume guidance (to 18–21% from 12–16%), reflecting strong system utilization trends, and we note that volume growth is the No. 1 barometer for future system placements,” he added.

The analyst further stated that the company has multi-year growth opportunities, driven by its technology leadership and robust underlying market trends.

Oppenheimer On Intuitive Surgical

Analyst Suraj Kalia reiterated a Perform rating on the stock.

The company delivered strong overall procedure growth, although on easier comps, Kalia said in a note. “Key concerns: OUS unused capacity still >40%, system revs flat y/y,” he added.

“Procedure guidance seems designed to limit returns, enable share repurchases (12.6M since 1Q22),” the analyst further wrote.

Truist Securities On Intuitive Surgical

Analyst Richard Newitter reaffirmed a Buy rating, while raising the price target from $300 to $325.

“ISRG's outsized +26% WW procedure growth upside (vs. 14% CNS), (unexpected) WW system beat, and healthy procedure guidance raise shld drive a +ve stock reaction (shrs up >7% post-mkt) alongside rising estimates,” Newitter said.

Although there were certain “moving parts in the go-fwd margin outlook (higher I&A ASPs offset rising input/supply & op-ex costs),” the first-quarter results and earnings commentary were “very impressive, leaving us reinforced in our view ISRG can sustain a mid-teens rev/EPS CAGR (a stand-out profile w/in lgcp MedTech),” he added.

Check out other analyst stock ratings.

William Blair On Intuitive Surgical

Analyst Brandon Vazquez reiterated an Outperform rating on the stock.

“Margins came in somewhat lower than expected due to transient supply issues and higher operating expenses, but higher revenues supported a three-cent EPS beat versus the Street and a two-cent beat versus our estimate,” Vazquez stated.

“Capex budgets remain constrained, but we believe first-quarter demand reinforces robotics as a priority for hospitals that should support momentum, especially as utilization growth (up 13% in the quarter) drives incremental system demand needed to support volume growth,” he added.

Mizuho Securities On Intuitive Surgical

Analyst Anthony Petrone maintained a Neutral rating, while raising the price target from $250 to $300.

“With momentum in OUS and US general surgery expected to continue, the co raised its full-year procedure outlook to +18-21% (+600bps at midpoint),” Petrone said in a note.

“Offsets in 1Q were on capital and gross margin where hospital spending and supply chain headwinds persist,” he added.

ISRG Price Action: Shares of Intuitive Surgical had surged by 12.49% to $303.06 at the time of publishing Wednesday.

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