Intuitive Surgical Earnings: Tops Analysts’ Expectations, Investors Take Profits

S&P 500 (NYSE:SPY) component Intuitive Surgical Inc. (NASDAQ:ISRG) reported net income above Wall Street’s expectations for the third quarter. Intuitive Surgical designs and manufactures da Vinci Surgical Systems, EndoWrist instruments and other surgical accessories.

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Intuitive Surgical Inc. Earnings Cheat Sheet

Results: Net income for the medical instruments rose to $183 million ($4.46 per share) vs. $122.4 million ($3.05 per share) in the same quarter a year earlier. This marks a rise of 49.5% from the year-earlier quarter.

Revenue: Rose 20.4% to $537.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Intuitive Surgical Inc. beat the mean analyst estimate of $3.52 per share with EPS of $3.54. It beat the average revenue estimate of $522.9 million.

Quoting Management: Dr. Gary Guthart, President and CEO of Intuitive Surgical, said, “Our third quarter highlighted both market strengths and significant headwinds. Procedures came in below our expectations, driven by conditions in Europe and changes in prostate cancer detection and treatment. On the positive side, acceptance of daVinci general and gynecologic surgery continues to grow.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 26.3%, with the biggest boost coming in the third quarter of the last fiscal year when revenue rose 29.7% from the year earlier quarter.

The company has now seen its net income increase for three consecutive quarters. In the second quarter, net income rose 31.9% and in the first quarter, the figure rose 37.8%.

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 35 cents in the second quarter, by 41 cents in the first quarter, and by 29 cents in the fourth quarter of the last fiscal year.

Looking Forward: Analysts have a positive outlook for the company’s performance next quarter. Over the past seven days, the average estimate for the fourth quarter has gone up to $3.62 a share from $3.61. Over the past three months, the average estimate for the fiscal year has climbed from $14.67 per to share to $14.72.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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