Is ISRG's 20% Procedure Growth the New Normal or a Peak?

Core Insights - Intuitive Surgical's (ISRG) third-quarter results show a 20% year-over-year increase in combined da Vinci and Ion procedures, raising questions about the sustainability of this growth rate [2][6] Company Performance - da Vinci procedures grew by 19%, while Ion volumes surged by 52%, with growth observed across various surgical fields including general surgery, gynecology, and international markets [3] - The introduction of da Vinci 5 has led to higher utilization rates compared to previous Xi systems, with U.S. utilization turning positive after being flat earlier in the year [3] - Management noted that some elective procedures may have been advanced due to uncertainties around Medicare funding, although this has not been confirmed by third-party data [4] - Bariatric procedures are declining at high single-digit rates due to the adoption of GLP-1 therapies, highlighting that not all surgical demand is immune to therapeutic changes [5] Market Dynamics - International growth was slightly aided by holiday timing shifts, contributing approximately one percentage point to growth [4] - Hospital budget constraints, particularly outside the U.S., and macro health policy changes could impact future capital and utilization momentum [5] Valuation and Estimates - ISRG's shares have increased by 8.1% over the past six months, compared to a 14.8% rise in the industry [12] - The company trades at a forward price-to-earnings ratio of 60.4, which is above the industry average but below its five-year median of 71.52 [13] - The Zacks Consensus Estimate for ISRG's 2025 earnings suggests a 17.9% increase from the previous year [15]