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Reiterate Intuitive at Neutral

Zacks Equity Research

On Apr 22, we retained Intuitive Surgical, Inc. (ISRG) at Neutral after the company reported favorable results for the first quarter 2013. In addition, ISRG made adjustments to its guidance for 2013.   

Why the Reiteration?

Intuitive Surgical reported first quarter 2013 earnings per share of $4.56 beating the Zacks Consensus Estimate of $4.00 while surpassing the year-ago results of $3.50. The company reported revenues of $611.4 million for the first quarter, up 23% year over year. The results beat the Zacks Consensus Estimate of $581 million.    

Worldwide procedures increased 18% year over year in the first quarter 2013. Growth in procedure count was 20% upon adjustment for the leap year in 2012.

Following the release of the first quarter results, the Zacks Consensus Estimate for 2013 has moved up (over the past 7 days) by a nickel to $17.59 while the same for 2014 has remained stagnant at $20.54 over the same timeframe.

The company modified favorable guidance for 2013. Intuitive Surgical modified its procedure growth rate to the lower end of 20% to 23% from 20% to 23% earlier. ISRG expects revenues to grow at the higher end of 16% to 19% for 2013 from 16% to 19% earlier. Operating income continues to be forecast in a band of 38% to 39% of sales for 2013. 

Med-Tech Stocks that Warrant a Look

Intuitive Surgical carries a Zacks Rank #2 (Buy). NuVasive, Inc. (NUVA), The Cooper Companies Inc. (COO) and Medical Action Industries Inc. (MDCI) carry Zacks Rank #1 (Strong Buy), Zacks Rank #2 (Buy) and Zacks Rank #2 (Buy), respectively, and are expected to do well.

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Read the Full Research Report on COO

Read the Full Research Report on NUVA

Read the Full Research Report on MDCI

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