One-glance verdict
Overvalued
$195.11 our estimate vs market $369.15
Wall Street consensus: $478.01 (145.0% higher than our fair-value estimate)
89% above our estimate, beyond the bull case
Fundamentals snapshot
Intuitive Surgical, Inc.
ISRG · NMS · Healthcare · Medical Instruments & Supplies
Current price
$369.15
52-week range
$328.57 - $603.88
Market cap
$132.26B
Balance sheet
Healthy
8.05x Adequate
Net cash $5.22B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 9.6% last year.
- Reward Returns 17.4% on equity, ahead of 83% of its peers.
- Reward Free cash flow was positive in 10/10 years.
What this company does
Intuitive Surgical, Inc.
Intuitive Surgical makes the da Vinci robotic systems that help surgeons perform operations through tiny incisions, which can lead to faster patient recovery. While selling the robots is important, the company makes most of its money from the disposable tools and ongoing services that hospitals must buy for every single procedure. This creates a powerful stream of recurring revenue (income that is predictable and repeats over time), meaning the company's sales grow automatically as more surgeries are performed.
How the company got here
Intuitive Surgical was founded in 1995 with an ambitious idea: to make surgery less invasive using robotic technology. The company's origins trace back to research from the late 1980s that was even explored by the U.S. military for remote battlefield surgery. After refining its prototypes, the company launched its first da Vinci Surgical System in Europe in 1999 and received FDA clearance in the U.S. in 2000. This marked a turning point, establishing robotic-assisted surgery as a new category in medicine and setting the stage for the company's growth. Over the years, Intuitive has released several generations of da Vinci systems, each more advanced than the last.
What it actually does
Intuitive Surgical creates robotic systems that help surgeons perform operations with tiny incisions, which can lead to less pain and a faster recovery for patients. It's important to know that the robots don't perform surgery on their own; every movement is controlled by a trained surgeon sitting at a console nearby. Think of the system as a high-tech tool that extends the surgeon's hands and eyes, allowing for very precise movements in hard-to-reach areas of the body. The company also makes a system called Ion that helps doctors diagnose lung cancer earlier by taking tiny tissue samples (biopsies) from deep within the lungs.
Systems
This is the most visible part of the business, involving the sale of the actual robotic surgical machines, like the flagship da Vinci system and the Ion system for lung biopsies. Hospitals and surgical centers pay a significant upfront cost for these systems, which can range from half a million to over two million dollars. While selling these high-tech machines is important, it makes up the smallest portion of the company's total income, representing about a quarter of its revenue. The real financial power of the company comes after a system is installed in a hospital.
Instruments & Accessories
This is the company's largest and most important business, making up the majority of its sales—about 60%. For every surgery performed with a da Vinci system, the hospital must use specialized tools and accessories, like tiny scalpels and graspers. Many of these instruments have a limited life and must be replaced after a certain number of procedures, creating a steady and predictable stream of income for the company. This is often called a 'razor-and-blades' model, where the initial sale of the robot (the razor) leads to ongoing sales of the necessary tools (the blades).
Services
This part of the business involves providing maintenance and support for the thousands of robotic systems installed in hospitals worldwide. When a hospital buys a da Vinci system, it typically signs a service contract with Intuitive Surgical. These contracts, which can cost tens of thousands of dollars annually, ensure the complex machines are always working correctly and include things like installation, repairs, and 24/7 technical support. This segment provides a reliable and recurring source of revenue (income that is predictable and likely to continue in the future), contributing a smaller but stable slice of the company's total earnings.
What management is betting on now
The company is focused on increasing the number of surgeries performed with its existing da Vinci robots, especially in general surgery and outside the United States. They are also rolling out their newest generation system, the da Vinci 5, which offers enhanced features for surgeons and aims to make procedures more efficient. Another key priority is expanding the use of their Ion system to help doctors diagnose lung cancer earlier and more accurately. Ultimately, the strategy is to make their technology the standard of care for a wider range of minimally invasive procedures, which benefits patients and drives recurring revenue (the predictable income from selling disposable instruments and services after a robot is installed).
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$458.60M
FY2024 Q4
$510.60M
FY2025 Q1
$465.00M
FY2025 Q2
$560.10M
FY2025 Q3
$735.60M
FY2025 Q4
$730.00M
FY2026 Q1
$808.60M
FY2026 Q2
$948.40M
Revenue
$2.89B
Net income
$818.10M
Diluted EPS
2.29
Operating cash flow
$1.06B
Free cash flow
$948.40M
Fetching…
Sources
Revenue
$2.77B
Net income
$821.50M
Diluted EPS
2.28
Operating cash flow
$911.90M
Free cash flow
$808.60M
Fetching…
Sources
Revenue
$2.87B
Net income
$794.80M
Diluted EPS
2.19
Operating cash flow
$892.50M
Free cash flow
$730.00M
Fetching…
Sources
Revenue
$2.51B
Net income
$704.40M
Diluted EPS
1.95
Operating cash flow
$841.00M
Free cash flow
$735.60M
Fetching…
Sources
Revenue
$2.44B
Net income
$658.40M
Diluted EPS
1.81
Operating cash flow
$715.40M
Free cash flow
$560.10M
Fetching…
Sources
Revenue
$2.25B
Net income
$698.40M
Diluted EPS
1.92
Operating cash flow
$581.60M
Free cash flow
$465.00M
Fetching…
Sources
Revenue
$2.41B
Net income
$685.70M
Diluted EPS
1.89
Operating cash flow
$822.60M
Free cash flow
$510.60M
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Sources
Revenue
$2.04B
Net income
$565.10M
Diluted EPS
1.56
Operating cash flow
$706.50M
Free cash flow
$458.60M
Fetching…
Sources
Is it cheap or expensive?
Fair value $195.11 vs current price $369.15
Wall Street consensus is the average analyst price target: $478.01 (145.0% higher than our fair-value estimate).
Our most-likely fair value is $195.11 a share — about 47.1% below today's price of $369.15, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $5.2B - more cash than debt. Interest coverage 8.1x.
Net debt
$-5.22B
Interest coverage
8.05x
Intuitive Surgical, Inc.'s profit covers its interest bill about 8.1 times over.
Healthy
Worse cushion
Baseline
Better cushion
ISRG
BASELINE
Intuitive Surgical, Inc.
Total debt $0.00 Interest coverage 8.05x This is the baseline the peer rows are being compared against.
Total debt $15.45B Interest coverage 8.33x +4% vs ISRG Has roughly the same debt cushion as ISRG.
Total debt $28.15B Interest coverage 9.55x +19% vs ISRG Carries about 1.2x more debt cushion than ISRG.
Total debt $704.40M Interest coverage 80.21x +896% vs ISRG Carries about 10.0x more debt cushion than ISRG.
Total debt $12.62B Interest coverage 11.38x +41% vs ISRG Carries about 1.4x more debt cushion than ISRG.
Total debt $7.60B Interest coverage 4.63x -42% vs ISRG Carries about 1.7x less debt cushion than ISRG.
What you should know
The case for and against ISRG
3 Rewards
0 Risks
Rewards
-
Revenue grew 9.6% last year.
-
Returns 17.4% on equity, ahead of 83% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
42.33x
Forward P/E
30.53x
P/B
7.19x
P/S
11.99x
EV/EBITDA
29.24x
PEG ratio
1.64x
Profitability
How much profit each dollar creates
Gross margin
66.7%
Operating margin
33.6%
Net margin
28.4%
ROE
17.4%
ROA
10.5%
Health
Liquidity and balance-sheet strength
Debt / equity
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Current ratio
4.96x
Quick ratio
3.64x
Total debt
$0.00
Total cash
$5.22B
Growth
How the business has been compounding
Revenue TTM
$11.03B
Revenue 5Y CAGR
15.2%
EPS TTM
8.72
EPS 5Y CAGR
29.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$3.71B
Free CF TTM
$2.49B
FCF margin
22.6%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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