Great Call on Intuitive Surgical! What's Next?

You want to talk about health-care reform? Let's talk about robots revolutionizing surgery.

Yeah, you heard me right: robots. When it comes to using technology to advance surgical precision, Intuitive Surgical (NASDAQ:ISRG) is at the forefront. The company makes the da Vinci surgical system, which allows surgeons to precisely control surgical instruments. According to Intuitive, da Vinci not only improves patient outcomes, but also reduces the invasiveness of surgical procedures.

But has Intuitive translated this cutting-edge technology into shareholder profits? You betcha. Over the past 12 months, the company's profits are more than double what they were in 2005.

Members of the Motley Fool CAPS community certainly seem to be impressed. More than 3,700 members have weighed in on the stock; 3,551 of them (including yours truly) have rated the stock an outperformer.

Quite a number of these Intuitive Surgical bulls have scored big points by betting on the stock. But few have racked up more than screach. By giving Intuitive a thumbs-up in January 2007 and hanging on ever since, screach has racked up nearly 250 points of market outperformance.

screach is one of CAPS' All-Stars -- players with a rating of 80 or greater -- and has managed an impressive stock-picking accuracy of 63% while earning more than 400 points of beating the market. Intuitive Surgical isn't this player's only great call. Here's a look at a few other prescient picks:

Data from CAPS.

So what has this investor been looking at more recently? Here are a few of the most recent calls on CAPS:

Data from CAPS.

While not all of these picks may pan out, they could be a good place to start further research. I decided to take a closer look at IBM.

Big Blue the blue chip
Way back in November 2006, when IBM was trading at just more than $88 per share, CAPS All-Star MCKIrobert rated IBM's stock an outperformer, writing:

IBM is another solid blue-chip that has a great infastructure in place. They still do good research and produce quality products. Their P/E is only 16, which is about in line with the overall S&P, but I think IBM has the ability to weather a financial storm if they need to.

Thus far, that call has been a market-beater to the tune of 60 points. Why? Well, it seems MCKIrobert hit the nail on the head.

The term "blue chip" can often be thrown around willy-nilly, often applied to companies that are huge and have been around a long time. However, in recent years, IBM has truly earned its place among the ranks of the blue chips. Sure, IBM is huge and has been around a long time. But the company has also showed its mettle by having the sense to move its business away from the rapidly commoditizing world of mainframes and personal computers, to focus more on software and consulting.

That gambit seems to be paying off. While top-line growth has been sluggish, over the past decade the company has expanded its operating margin from 13% to more than 19%. This has nearly doubled the company's bottom-line profit.

And as far as financial soundness, MCKIrobert was right on the money again. IBM laughed in the face of recession, using its plentiful cash flow to pay down debt and repurchase shares. Today, IBM's balance sheet is just as impressive as it was at the beginning of the recession.

But here's the important question: What's your take? Will IBM continue to prove that it's a real-deal blue chip? Get in the action by clicking over to CAPS. It's absolutely free, and our community already has more than 145,000 stock pickers chipping in to find the best stocks out there.

Sure, low valuations can be very tempting, but Joe Magyer recently highlighted how investors seeking value can get caught in value traps.