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Tickers in this Article: ISRG
When Intuitive Surgical (Nasdaq:ISRG) releases its third quarter earnings on Tuesday, October 16, 2012, it is expected to report earnings that are up 14.1% from a year ago. The consensus estimate is $3.48 per share, up from earnings of $3.05 per share a year ago.

In most situations, when earnings do not meet analyst estimates, a business' stock price will tend to drop. On the other hand, when actual earnings beat estimates by a significant amount, the share price will likely surge. SEE: 12 Things You Need To Know About Financial Statements

What to Expect: The consensus estimate, while unchanged in the past month, is down from $3.61 three months ago. Analysts are projecting earnings of $14.81 per share for the fiscal year.

Intuitive Surgical is expected to beat last year's reported revenue of $446.7 million and come in at $534.9 million for the quarter. Revenue of $2.16 billion is expected for the fiscal year.

Company Performance: Revenue increases have been in the double digits for the past four quarters. On average, the figure has risen by 27.7%. The biggest change came in the third quarter of the last fiscal year when revenue rose 29.7%.

ISRG has a P/E ratio of 35.2. A simple P/E ratio can reveal the stock's real market value and show how the valuation compares to its industry group or a benchmark like the S&P 500 Index. A high or low P/E ratio is not good or bad in and of itself, but a company trading with a high P/E ratio must continue to post strong financial performance or its stock price is likely to fall. SEE: Profit With The Power Of Price-To-Earnings

The stock price has fallen 8.4% to $494.63 from $540.04 since July 13, 2012. Intuitive Surgical's worst recent stretch was when its stock price fell $15.95 per share between September 25, 2012 and September 26, 2012.

The Competition: Intuitive Surgical designs and manufactures da Vinci Surgical Systems, EndoWrist instruments and other surgical accessories. Eight of 13 analysts rate Intuitive Surgical a hold. This rating has been constant for the past three months.

The company's closest competitor in the medical equipment and supplies industry is Medtronic (MDT). Analysts are less optimistic about Intuitive Surgical than about Medtronic. Eleven out of 22 analysts rate the latter a buy compared to five of 13 for the former.

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