Is It Time To Buy Intuitive Surgical Stock?

Core Viewpoint - Intuitive Surgical (ISRG) stock is considered a worthwhile investment due to high margins and cash generation capabilities, currently available at a discounted price [2]. Company Overview - Intuitive Surgical is the global leader in robotic-assisted surgery, primarily known for its da Vinci surgical system, which enhances precision, efficiency, and safety in minimally invasive procedures, driving recurring revenue through instruments, services, and system upgrades [3]. Recent Performance - ISRG stock has increased by 8.9% year-to-date, while its Price-to-Sales (P/S) ratio is 12% lower compared to one year ago [5]. - In Q3 2025, there was a 20% global increase in procedures, largely due to the adoption of the da Vinci 5 system, with 240 units installed, bringing the total installed base to nearly 10,800 systems [6]. - The company has 85% recurring revenue from instruments and services, ensuring robust cash generation [6]. - Management has raised full-year 2025 procedure growth projections to 17-17.5%, indicating strong demand and pricing power [6]. Financial Metrics - Recent profitability metrics include an operating cash flow margin of 30.8% and an operating margin of 29.3% for the last twelve months [11]. - Long-term profitability metrics show an average operating cash flow margin of approximately 27.8% and an operating margin of 26.7% over the last three years [11]. - Revenue growth for Intuitive Surgical was 22.2% for the last twelve months and 16.3% on a three-year average, although it is not classified as a growth story [11]. - The stock is currently available at a P/S multiple of 16.6, representing a 12% discount compared to one year ago [11]. Investment Criteria - The company meets several investment criteria, including a market cap greater than $10 billion, high cash flow from operations margins, and a significant decline in valuation over the past year [12].