Intuitive Surgical shares by 18%.. Is it the time to buy?

Intuition Surgical presented a unique model in combining technology and medicine, and it was one of the first companies to change the concepts of traditional surgery by using robots in complex operations, and with the passage of time it turned into a leading company in this field, achieving a constant growth in sales and profits, which made it one of the most shares that gave strong returns to investors, as the rate of return since its launch in 2003 reached more than 24,600%, which is an amazing number that reflects its long -term success.

But this does not prevent that the market is by its nature volatile and with the increasing global concern about the slowdown in the economy and the company providing different expectations, the stock has declined by 18% from the highest historical level recorded in January, which opens the door for discussion about whether this decline was an attractive opportunity for purchase or that the next may carry additional fluctuations.

Leadership in the field of robotic surgery

Surgeons that are carried out with the help of robots have become more common because of the accuracy and safety they provide, as the process is performed through smaller cracks, which reduces bleeding and speeds up recovery and improves the results of treatment, and only 2024, about 2.7 million operations were carried out using the “Da Vinci” system from Intuition Surgical, which is twice what was done five years ago, which reflects the great growth in relying on this type of operation.

A new generation with revolutionary capabilities

The company recently launched the “Da Vinci 5” system that obtained the approval of the American Food and Drug Administration last year, and is a real transformative step compared to the previous version. More than 150 design modifications were introduced, and the new system is characterized by a computer power that exceeds the previous generation “Da Vinci XI” ten times, making it a new starting point for future sales growth.

But at the same time this major update may cause some financial and operational fluctuations in the short term, given that hospitals need time to adapt to the new technology, and the company indicated that the number of operations using its systems may grow by between 13% and 16% during the year 2025, which is a good percentage but it is less than the previous year growth that reached 17%, as well Associated with the launch of the new system.

My transition year with distinction

The effects of these transformations clearly appeared in the profit expectations that Wall Street put in place, as analysts estimate that the share profitability will grow by 9.6% in 2025, which is a weaker rate of growth rate in 2024, which reached 28.5%, however this slowdown is not seen as permanent, but analysts consider it a general introductory transition as the profits are expected to accelerate again to reach To growth of 17.5% in 2026.

Financial performance estimates

Revenue in 2024: growth of 17.2%. Expectations for 2025: growth of 14.9%. Expectations for 2026: growth of 15.6%. The arrow profit in 2024: 7.34 dollars. Estimates for 2025: 8.06 dollars. Estimates for 2026: 9.47 dollars. Annual arrow profit growth: 28.5%, 9.8%, then 17.5%.

Fears of competition

Although the company appears to be in a strong position in terms of performance and future, there are some concerns that must be taken into account, including the intensification of competition in the field of robotic surgery, while the company retains the largest number of internationally approved uses, major companies have begun to launch their own platforms, including the “Hugo” system from Medtonic, and the “Luna” system from Asensus Surgical In addition to Johnson & Johnson robot, all of which represent potential alternatives that may attract some customers, especially if they are at lower prices.

The company’s financial manager – Jimmy Samath – pointed out that the presence of competitors obtaining organizational approvals, whether inside or outside the United States, may cause delay in some purchase decisions, as he said that the increasing competition necessarily means longer sale courses, especially outside the Chinese market.

High evaluation imposes caution

Under these circumstances, the stock is still trading at a high value, as the expected profitability doubles, which is slightly higher than its average over the past ten years, which amounted to about 62, but it must be taken into account that growth in the past decade was faster, so any sudden decline in sales or profits may lead to an additional decrease in the value of the stock, which investors should think carefully.