The Impressive Number No One Is Talking About

Intuitive Surgical (NASDAQ:ISRG) is up more than 20% today after it smashed analysts' revenue and earnings estimates yesterday afternoon. Revenue at the Rule Breakers pick came in over $260 million compared to analyst expectations of $230 million. Earnings per share were $1.62 versus expectations of $1.27.

That's a thrashing of estimates if I've ever seen one, but those aren't the numbers that long-term investors in the maker of robotic surgery equipment should be focused on. Instead, turn your attention to these two year-over-year comparisons:

• Procedures done on da Vinci systems up 52%.
• Da Vinci systems sales down 10.5%.

That can't continue forever; only so many procedures can be done on a machine in a day.

Last year, 28% of surgical systems went to customers who already had a da Vinci, but that slipped to 21% in the most recent quarter. Tightening hospital budgets are hurting many medical-device companies -- Natus Medical (NASDAQ:BABY), Stryker (NYSE:SYK), and Medtronic (NYSE:MDT), for instance -- but it seems that da Vinci-less hospitals are making room in their budget to get in on the craze, while some hospitals that already have one are making surgeons fight for time on the machine.

But efficient scheduling can only get you so far and, as more procedures are developed, the fighting among hospital departments is only going to get worse. It seems likely that there will be a lot of pent-up demand for da Vinci systems, especially as the economy turns around.

Intuitive Surgical will have plenty of hospitals to target, too. In the U.S. there are 1.25 da Vinci systems for every hospital that owns one. That leaves plenty of room to run -- and today's thrashing may be just the beginning.

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