Intuitive Surgical: Is The Smart Money Moving In?

Core Insights - Intuitive Surgical (ISRG) stock is considered a worthwhile investment due to high margins and cash generation capabilities at a discounted price, which mitigates risk and enables capital reinvestment [2][10] 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 [4] - 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, contributing to an installed base nearing 10,800 systems [5] - Management has raised full-year 2025 procedure growth projections to 17-17.5%, indicating strong demand and pricing power [5] 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 [10] - Long-term profitability metrics show an average operating cash flow margin of 27.8% and an operating margin of 26.7% over the last three years [10] - Revenue growth has been reported at 22.2% for the last twelve months and 16.3% for the last three-year average [10] Valuation - ISRG stock is currently available at a P/S multiple of 16.6, representing a 12% discount compared to one year ago [10]