With disappointing revenue already announced, it seemed that Intuitive Surgical's (NASDAQ:ISRG) stock price action today depended more on what CEO Lonnie Smith said on the conference call than what was in the press release.

And I'll bet he could have cared less. This is, after all, the guy who told an analyst on last quarter's call, "If you're buying this stock for the next quarter, don't." With that kind of long-term thinking, I'm pretty sure he could get a job at The Fool, should he ever want to quit his day job.

Management is expecting revenue this year to go up 15%, but you'd have to guess that it's being conservative, given the previous annihilations of its guidance. Even this year, when things fell apart in the last quarter, it still beat the growth it was predicting at the beginning of the year.


Revenue guidance increase over prior year

Actual increase in revenue
















Source: Company press releases and year-end earnings conference calls.

The installed base, which now sits at 1,111 da Vinci systems, is driving sales. The disposable instruments and service contracts now contribute more than half of revenue. Razor blade! Sales of da Vinci systems are expected to be flat this year as hospitals are expected to tighten up capital spending. Companies from tiny Natus Medical (NASDAQ:BABY) to larger Hologic (NASDAQ:HOLX) have reported similar slowdowns in spending from hospitals.

While revenue is projected to grow at 15% this year, the bottom-line earnings per share are only expected to grow 5% year over year. Part of that discrepancy is because the company is unwilling to cut back on research and development expenses during the downturn -- there's that long-term thinking again.

Even with the paltry projected growth, the multiple Rule Breakers pick looks like a good long-term investment at less than 18 times projected earnings. Sure, you can have other medical-device makers -- Medtronic (NYSE:MDT), Stryker (NYSE:SYK), Zimmer (NYSE:ZMH), and Kinetic Concepts (NYSE:KCI) for instance -- for less, but when was the last time any of them had 50% organic revenue growth?

Either investors think robotic surgery is dead and that 50% growth will never be seen again, or they're being short-sighted. My guess is that it's the latter, and investors who can look further than the tips of their noses should be able to make astonishing profits when things return more to normal.

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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Natus Medical is a Motley Fool Hidden Gems pick. The Fool owns shares of Stryker and Kinetic Concepts. The Fool has a disclosure policy.