Intuitive Surgical Set to Announce Q3 Results: What to Expect

Intuitive Surgical (NASDAQ: ISRG) will report its Q3 2024 results on Thursday, October 17. Analysts anticipate the company’s revenues will reach $2 billion, with adjusted earnings projected at $1.60 per share. This forecast indicates revenues may be slightly above but earnings a bit below consensus estimates. Continued growth in procedure volume and increased placements of the new da Vinci 5 surgical platform are expected to support these results. For detailed insights, take a look at our interactive dashboard analysis on Intuitive Surgical FY 2024 Q3 Earnings Preview.

Key Drivers for Intuitive Surgical’s Q3 Performance

Recent success for Intuitive Surgical stems from placing more da Vinci systems and an upswing in procedure volume. The company is expanding its installed base, leading to increased recurring revenue from consumables. Projections suggest global da Vinci procedure volume will grow between 15.5% to 17% in 2024. This growth in installations will likely enhance consumables and services revenue, and a slight improvement in operating margins is expected to contribute positively to the bottom line.

Review of Previous Quarter’s Performance

In its last quarter, Intuitive Surgical reported $2.0 billion in revenue, reflecting a 6% increase compared to the previous year, driven by a 17% rise in worldwide da Vinci procedures. During that period, the company successfully installed 341 da Vinci systems, including 70 of the new da Vinci 5 systems launched earlier this year in the U.S. The total installed base saw a 14% year-over-year increase, totaling 9,203 systems. Additionally, operating margins expanded by around 340 basis points to 28.2%. On an adjusted basis, the bottom line reached $1.78, marking a substantial 25% increase from the prior year and exceeding estimates of $1.55.

Implications for ISRG Stock

ISRG has performed well in 2024, seeing a 45% increase, outpacing broader market gains. Currently, the stock price appears to align with our estimated valuation of $462 per share, slightly below the current market value of $480. This estimate utilizes a 20x price-to-sales (P/S) ratio, which aligns with its average over the past four years. Over a longer timeframe, however, the stock’s performance has shown volatility compared to the more stable S&P 500. In contrast, the Trefis High Quality (HQ) Portfolio, which comprises 30 stocks, has outperformed the S&P 500 consistently, demonstrating a reliable return with reduced risk.

Understanding Intuitive Surgical’s Market Standing

While ISRG stock seems to be fairly valued, it is instructive to compare Intuitive Surgical’s Peers using key performance metrics. For more insights, check out our Peer Comparisons.

[1] Returns as of 10/14/2024
[2] Cumulative total returns since the end of 2016

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.