Intuitive Surgical (ISRG) to Post Q3 Earnings: What's in Store?
Intuitive Surgical, Inc. ISRG is scheduled to release third-quarter 2023 results on Oct 19, after the closing bell.
The company’s shares have risen 3.3% year to date against the industry’s 11% decline. The S&P 500 Index gained 14% in the same time frame.
In the last reported quarter, ISRG delivered an earnings surprise of 7.58%. Its earnings beat estimates in three of the trailing four quarters and missed the same in one, delivering an average surprise of 2.38%.
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Q3 Estimates
The Zacks Consensus Estimate for ISRG’s revenues is currently pegged at $1.77 billion, indicating a 13.6% improvement from the year-ago quarter’s reported figure. The consensus mark for earnings is pinned at $1.41 per share, indicating an 18.5% year-over-year increase.
Factors to Note
The Instruments & Accessories segment is likely to have witnessed a strong third-quarter performance on the back of rising da Vinci procedure volume as seen in the past few quarters. However, an unfavorable currency movement is expected to have partially offset the gains from recovering demand in procedures. Meanwhile, a rise in the proportion of recurring revenues buoys well for ISRG.
Moreover, the recovery in China on the back of strong procedure growth following COVID-related setbacks in the past year is likely to have boosted sales in the soon-to-be-reported quarter.
The Zacks Consensus Estimate for Instruments & Accessories’ revenues is pegged at $1.07 billion, indicating a 14.7% improvement year over year.
Intuitive Surgical’s da Vinci capital placements are likely to be on the lower side due to continued supply-chain challenges impacting the availability of semiconductor components and growing capital spending pressure on hospitals amid rising inflationary pressure.
The FDA’s approval for the use of the da Vinci SP surgical system for simple prostatectomy as a representative procedure in April might have expanded its application in urologic surgical procedures. The impact of this new approval is likely to be reflected in the third-quarter results. Moreover, the continued launch of the da Vinci single-port in Japan should have brought additional revenues during the quarter.
The Zacks Consensus Estimate for the da Vinci system’s salesin the United States is pegged at 158 units.
However, Intuitive Surgical’s da Vinci capital placements are likely to have benefited from rising demand outside the country. The company placed 174 systems in the second quarter of 2023 compared with 129 in the prior-year quarter in ex-U.S. markets. The trend is likely to have continued in the to-be-reported quarter.
The single port platform’s growth is expected to have been driven by additional clinical indications and clearances in markets beyond the United States and Korea. The Zacks Consensus Estimate for the da Vinci system’s sales outside the United States is pinned at 147 units, indicating a 15.7% year-over-year improvement.
During the first quarter, Intuitive Surgical received the CE-Mark for its Ion catheters followed by their launch during the second quarter, beginning with the United Kingdom. The availability of Ion catheters in Europe is likely to have brought additional revenues during the third quarter.
The company may also provide a view on the uptake in the region. ISRG’s digital products like the Intuitive Hub and the recently launched Case Insights are likely to have shown rising adoption.
However, government policy changes in China, higher logistics costs amid supply-chain challenges and rising inflationary pressure are likely to have hurt sales and increased expenses.
What the Zacks Model Unveils
Per our proven model, the combination of a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate ($1.42 per share) and the Zacks Consensus Estimate ($1.32 per share), is +7.58%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Zacks Rank: Intuitive Surgical currently has a Zacks Rank #4 (Sell).
Intuitive Surgical, Inc. Price and Consensus
Intuitive Surgical, Inc. price-consensus-chart | Intuitive Surgical, Inc. Quote
Stocks Worth a Look
Here are some medical stocks worth considering as these have the right combination of elements to post an earnings beat this reporting cycle.
Insulet PODD has an Earnings ESP of +5.00% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company’s shares have lost 53.8% year to date. PODD’s earnings beat estimates in the last reported quarter. It has a four-quarter average earnings surprise of 126.94%.
IQVIA IQV has an Earnings ESP of +0.51% and a Zacks Rank of 3.
The stock has lost 2.9% year to date. IQV’s earnings beat estimates in the last reported quarter. IQVIA has a training four-quarter average earnings surprise of 2.26%.
Abbott Laboratories ABT has an Earnings ESP of +1.62% and a Zacks Rank of 3.
The stock has lost 16% year to date. ABT’s earnings beat estimates in the last reported quarter. Abbott Laboratories has a four-quarter average earnings surprise of 12.44%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Abbott Laboratories (ABT) : Free Stock Analysis Report
Intuitive Surgical, Inc. (ISRG) : Free Stock Analysis Report
Insulet Corporation (PODD) : Free Stock Analysis Report
IQVIA Holdings Inc. (IQV) : Free Stock Analysis Report
