Intuitive Surgical Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Intuitive Surgical (Nasdaq: ISRG  ) rose more than 11% in early trading today after soundly beating estimates in its third-quarter financial report.

So what: Revenue climbed 30% to $446.7 million, while per-share profits rose 41% to $3.05. Analysts had been expecting $2.76 a share on $418.02 million in revenue, according to data compiled by Yahoo! Finance.

Now what: Both beats were noticeable, and in line with what we've seen historically from the robot-surgeon manufacturer. So what drove the gains? The outlook, it seems. Management now says revenue will grow 22% to 23%, up from an earlier estimate of 19% to 21%. Intuitive Surgical also expects 29% to 30% growth in procedures performed via its da Vinci system, a nice bump over earlier estimates of 27% to 29% growth. But is it enough when the stock trades for more than 33 times estimated earnings? You tell me. Please weigh in using the comments box below.

Interested in more info on Intuitive Surgical? Add it to your watchlist by clicking here.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

Motley Fool newsletter services have recommended buying shares of Intuitive Surgical. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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