A Look At Intuitive Surgical (ISRG) Valuation As AI Surgery Expectations Build Ahead Of Earnings

Simply Wall St.01-14

Trending interest in Intuitive Surgical (ISRG) centers on expectations that AI-enabled diagnostics and software revenue could reshape margins, with investors closely watching procedure volumes, ...

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However, the 90 day share price return of 28.97% and 3 year total shareholder return of 114.66%...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"BGSX":"Build Acquisition Corp","ISRG":"直觉外科公司"},"translate_title":"随着人工智能手术预期在盈利之前建立，直观外科(ISRG)的估值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BGSX":1.5,"ISRG":1.5},"content_text":"Trending interest in Intuitive Surgical (ISRG) centers on expectations that AI-enabled diagnostics and software revenue could reshape margins, with investors closely watching procedure volumes, recurring sales, and the upcoming January 22 earnings report. See our latest analysis for Intuitive Surgical. Recent trading has been choppy, with a 7 day share price return of 5.23% and a 1 day move lower. However, the 90 day share price return of 28.97% and 3 year total shareholder return of 114.66% point to momentum that has built meaningfully over time as attention has shifted to AI driven procedure growth, recurring revenue and the upcoming January 22 earnings update. If AI driven surgery is on your radar, it can help to see how other healthcare names are priced and growing, starting with healthcare stocks. With Intuitive Surgical trading around $561.82 and analyst targets pointing higher, along with strong historical shareholder returns already on the board, you have to ask: is there real upside left here, or is the market already pricing in future growth? AdvertisementMost Popular Narrative: 5.8% Undervalued With Intuitive Surgical last closing at $561.82 against a narrative fair value of about $596.36, the current price sits below that modeled outcome, putting the focus squarely on what is baked into the cash flow and earnings assumptions. Ongoing product innovation (including full launch of da Vinci 5, integrated force feedback, and digital/AI case insights), coupled with R&D to expand into adjacent specialties, is highlighted as a potential driver of clinical outcomes and surgeon efficiency, supporting assumptions for procedure growth, higher system ASPs, and recurring instrument and accessory revenues in the narrative model. Read the complete narrative. Want to see what kind of revenue run rate, margin profile, and future P/E multiple need to come together to support that fair value? The narrative relies on assumptions for steady double digit top line growth, robust profitability and a premium earnings multiple usually reserved for premium franchises. Curious how those moving parts compare with today’s $561.82 price and the current analyst target range? The full story breaks down those building blocks in detail. Result: Fair Value of $596.36 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this story can change quickly if tariff and trade costs squeeze margins or if hospitals turn to cheaper third party instruments to manage budgets. Find out about the key risks to this Intuitive Surgical narrative. Another View: Rich Multiples Test The Undervaluation Story That 5.8% gap to the narrative fair value points to some upside, but the P/E ratio of about 72.5x paints a tougher picture. It is more than double the US Medical Equipment industry at 30.9x, above peers at 34.4x, and well ahead of a 39x fair ratio, which leaves far less room for disappointment if growth or margins soften. See what the numbers say about this price — find out in our valuation breakdown. NasdaqGS:ISRG P/E Ratio as at Jan 2026 Build Your Own Intuitive Surgical Narrative If this view does not quite fit your thinking, or you prefer to work directly with the assumptions and data yourself, you can build a custom narrative in just a few minutes using Do it your way. A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Intuitive Surgical. Looking for more investment ideas? If Intuitive Surgical is on your watchlist, do not stop there. A few minutes exploring focused stock ideas can reveal opportunities you would otherwise miss.  Target potential growth stories early by checking out these 3533 penny stocks with strong financials that pair smaller market caps with stronger balance sheets and fundamentals. Zero in on companies priced below their estimated cash flow value through these 884 undervalued stocks based on cash flows, so you can focus your research where expectations may be lower. Add income angles to your watchlist by scanning these 13 dividend stocks with yields > 3% that currently offer yields above 3% and still pass basic fundamental checks.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: AI Stock Screener & AlertsOur new AI Stock Screener scans the market every day to uncover opportunities.• Dividend Powerhouses (3%+ Yield)• Undervalued Small Caps with Insider Buying• High growth Tech and AI CompaniesOr build your own from over 50 metrics.Explore Now for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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