Intuitive Surgical (ISRG) Q3 Earnings Preview: Here's What to Expect

Medical device maker Intuitive Surgical (ISRG) is scheduled to report its third-quarter results on October 17. The company exceeded analysts' expectations for the sixth consecutive quarter. Analysts are optimistic about ISRG's prospects and expect continued growth driven by demand for the company's robotic surgical devices, primarily da Vinci surgical systems.

Analysts' expectations for ISRG's Q3 results

Intuitive Surgical impressed investors with second-quarter revenue growth of 14% to $2.01 billion and earnings per share (EPS) rising over 25% to $1.78. The company reported a 14% increase in the installed base of its da Vinci surgical systems to 9,203 systems. Additionally, ISRG increased its revenue by 17% due to a 17% increase in da Vinci procedures.

Analysts expect the company's third-quarter earnings per share to rise more than 12% to $1.64. They expect revenue to rise 15% to $2.01 billion.

Ahead of Q3 results, Truist analyst Richard Newitter raised the price target on ISRG shares from $520 to $570 and maintained a Buy rating. As for the broader MedTech sector, the analyst believes that companies with elective or deferable procedure areas could announce more muted guidance increases due to Hurricane Helene.

Still, the analyst believes Intuitive Surgical deserves a premium multiple given the continued surge in procedure growth and a new product cycle that has the potential to accelerate revenue and EPS growth.

Likewise, Raymond James analyst Jayson Bedford increased the price target for Intuitive Surgical from $500 to $540 and reiterated a Buy rating. Bedford expects accelerated sales growth over the next two years with the launch of da Vinci 5 and expects da Vinci 5's rankings to be better than expected.

Options traders expect stocks to move more than 5%

Using TipRanks' options tool, we can see what options traders expect from the stock immediately after the earnings report. The expected earnings development is determined by calculating the “at-the-money” straddles of the options that are closest to expiry after the earnings announcement. According to the tool, options traders expect a 5.54% move in either direction.

Is ISRG stock a buy?

With 15 Buys and five Holds, Intuitive Surgical stock receives a Strong Buy consensus rating on TipRanks. ISRG stock's average price target of $513.84 implies an upside potential of 7.4%. Shares are up about 42% so far this year.

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