Intuitive Surgical (NASDAQ:ISRG) stock tanked more than 9% following the release of weaker-than-expected fourth-quarter results. The robotic surgical device maker’s performance was impacted by lower systems placed in Q4 along with rising COVID-19 cases in China that hampered procedure volumes in the region.
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Adjusted earnings per share declined 4.7% year-over-year to $1.23, below the analysts’ consensus of $1.25. Meanwhile, Intuitive’s Q4 revenue increased 6.8% to $1.66 billion but lagged behind the Street’s estimate of $1.67 billion.
The top-line growth was driven by higher da Vinci procedure volume on a global basis, partially offset by currency headwinds and lower system placements.
Q4 da Vinci procedure volumes grew by 18%. Further, the company placed 369 da Vinci Surgical Systems during the quarter, down from 385 systems in Q4 2021 but better than the 305 in Q3 2022.
Regarding the full-year 2023 outlook, the company expects procedure growth in the range of 12% to 16%. Also, pro forma operating expense growth is expected to be between 9% and 13%.
Is ISRG a Buy or Sell?
Following the release, BTIG analyst Ryan Zimmerman reiterated a Buy rating on the stock but lowered the price target to $279 from $316.
Zimmerman expected the company to confirm the launch of its next-gen multiport robotic system. He believes that the need to conduct clinical trials to bag regulatory approval, along with supply chain issues, may have caused the company’s plans to be delayed.
Overall, the Street is optimistic about ISRG stock with a Strong Buy consensus rating based on 11 Buys and three Holds. The average stock price target of $287.07 implies 11.3% upside potential. Shares of the company have gained 8.5% in the past three months.
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