Core Viewpoint - Intuitive Surgical, Merck, and Johnson & Johnson are highlighted as potential healthcare stock investments as October ends, each offering unique advantages for investors [1] Group 1: Intuitive Surgical - Intuitive Surgical specializes in surgical robots, a growing medical device technology that enhances patient outcomes through precision and less invasive techniques [2] - The installed base of Intuitive Surgical's da Vinci system increased by 13% in Q3 2025, while the Ion endoluminal system saw a 30% increase, leading to a 20% year-over-year rise in procedures using its robots [3] - Approximately 75% of Intuitive Surgical's revenue comes from services and instruments, creating a strong annuity-like income stream, with shares down about 15% from their 52-week highs, indicating potential for growth [4] Group 2: Merck - Merck is a major pharmaceutical company with a long history, currently facing some company-specific and industry-wide challenges but expected to maintain its 3.7% dividend yield [5] - The company is approaching a patent cliff with some drugs losing patent protection, raising concerns about its ability to replace lost revenue with new drugs, although this is viewed as a short-term issue [6] Group 3: Johnson & Johnson - Johnson & Johnson is recognized as a Dividend King, operating in both medical devices and pharmaceuticals, and is noted for its strong performance alongside Intuitive Surgical and Merck [7]

Core Insights - Intuitive Surgical operates a focused business model centered around its da Vinci surgical robot, which is a leading medical device in the industry [2][3] - Despite robust demand for da Vinci systems, Intuitive Surgical's reliance on a single product exposes it to stock volatility, making it less appealing for conservative investors [3][4] - Medtronic presents a diversified alternative, offering exposure to surgical robots while also operating in various medical sectors, which may be more suitable for conservative investors [6][10] Company Performance - Intuitive Surgical has 10,488 da Vinci robots globally, marking a 14% year-over-year increase, with surgeries performed by these robots up 17% year-over-year [3] - Medtronic is recovering from a challenging period, with its fiscal first quarter of 2026 showing an 8.4% revenue growth and 4.8% organic sales growth [8] Investment Considerations - Medtronic offers a nearly 3% dividend yield, significantly higher than the S&P 500's 1.2% and the healthcare sector's average of 1.7%, making it attractive for dividend-seeking investors [9][10] - Intuitive Surgical does not provide a dividend, which may deter conservative investors looking for income [9] Long-term Outlook - Intuitive Surgical is recognized as a well-run business with a promising long-term outlook, but its stock may not suit all investors due to its volatility [11]